Blockchain is exposed to increasing attacks from hackers

One of the main selling points of blockchain is its security. The decentralized nature of the technology should make it resistant to tampering and fraud. But as with all technology, blockchain is not immune to hacking.

According to the data collected by the Atlas VPN team, blockchain hackers stole cryptocurrencies worth $3.5 billion in 2022. Blockchain bridges lost $1.2 billion worth of cryptocurrencies in just 16 incidents. The Ronin Network sidechain bridge suffered the biggest hack of the year, as the attacker made off with $610 million.

Furthermore, the BSC ecosystem lost over $870 million in 76 attacks or scams in 2022. The Ethereum ecosystem is not far behind, with 49 incidents resulting in losses of more than $500 million in cryptocurrencies.

Other crypto-related projects and people fell victim to 48 hacks, causing nearly $370 million in losses.

Additionally, it is worth mentioning that even if we do not include the FTX collapse that lost more than $8 billion of customers’ money, it is considered a fraudulent exchange by most crypto experts.

Cybersecurity writer at Atlas VPN, Vilius Kardelis, shared his thoughts on blockchain hacks: “As the use of blockchain technology continues to grow and become more mainstream, we can expect to see a corresponding increase in the number of hacking attempts targeting these systems.”

Blockchain hacks are on the rise

Despite the fall of the crypto market in 2022, cybercriminals are still targeting blockchain networks and exchanges for their financial gain.

In 2022, cybercriminals and fraudsters caused a total of 301 blockchain incidents. Hacking last year increased by 27% compared to 2021, when researchers recorded 237 blockchain incidents.

The first quarter of 2022 started strong with 79 blockchain events, the most recorded in a quarter at the time. But in the second quarter, the number of hacks increased by 24% and reached new highs at 98 events.

But there is also good news. Due to the falling prices of most crypto, blockchain hacks have dropped significantly to 56 incidents in the third quarter, a 43% decrease compared to Q2. But while the crypto market remains down, blockchain hackers and fraudsters came back with more schemes in the last quarter of the year, with 68 incidents and more than $1 billion in stolen profits.

What is driving the interest of hackers in blockchain?

• Many DeFi projects still have insufficient levels of security testing before going live
• A significant number of projects explore bridging chains, which is a major goal
• Hackers are getting better at what they do, making it difficult to stay ahead of the bad actors
• Blockchain developers don’t read past hacks, and repeat vulnerabilities

For cryptocurrency investors, the watchword remains one of moving with extreme caution in this market. The big lesson learned in 2022 was not to store assets on the stock exchange. Where possible, if you are not actively trading, keep your cryptocurrency assets in a cold wallet or with some form of independent custodian that has a Tier 1 regulator.