2021 was a record year for crypto attacks as not just the number of incidents including breaches and frauds but also the amount stolen in cryptocurrencies was highest in the past decade, indicating a parallel growth of crypto crime with the global crypto market. Across 76 such incidents, $4.25 billion in cryptos was stolen in 2021 \u2014 highest during the 2011-21 period, according to a report by the crypto transaction analysis and monitoring platform Crystal Blockchain. Overall, 226 incidents involving 120 security attacks, 73 decentralised finance (DeFI) protocol exploits, and 33 fraudulent schemes were reported during the said period with a total of around $12.1 billion in cryptos stolen.<\/p>\n
The second-highest loss in cryptos was recorded in 2019 when $3.5 billion was taken away in 26 different incidents. In 2020, this was reduced to $1.49 billion in 31 incidents. The most popular method of crypto theft was the infiltration of crypto-exchange security systems. \u201cThe most notable type of attack is security breaches in the internal security systems of a cryptocurrency entity, whereby illegal access is gained to the hot wallets belonging to the crypto service,\u201d the report noted. Back in 2018, Japanese crypto exchange\u00a0Coincheck\u00a0had reported around 523\u00a0million\u00a0of its NEM coins worth over $500 million stolen in a security breach. In August this year, hackers stole over $600 million in Ethereum and other cryptocurrencies reportedly from Poly Network which is a cross-chain\u00a0DeFi\u00a0platform that lets users transfer coins through different blockchains. However, the entire amount was returned by hackers later.<\/p>\n
The biggest share in the stolen $12.1 billion between January 2011 and December 2021 was $7.12 billion stolen through scams followed by $3.18 billion taken away through security breaches, and $1.76 billion\u00a0via\u00a0DeFi\u00a0hacks. \u201cDeFi\u00a0hacks will continue increasing, while the\u00a0DeFi\u00a0industry continues building better security systems and hackers continue to do their best to break these systems,\u201d Crystal Blockchain said.<\/p>\n
Also read: Cryptocurrency in 2022: Top trends likely to keep crypto space buzzing in new year<\/strong><\/a><\/p>\n In terms of the regions with the highest number of incidents, the US topped the tally.\u00a0Since the beginning of blockchain\u2019s existence, US-based crypto services have been targeted a whopping 13 times. However, in terms of value, China witnessed the biggest crypto attacks. This was mostly due to the\u00a0PlusToken\u00a0Ponzi scheme of 2019 that accounted for $2.9 billion and the related\u00a0WoToken\u00a0scam last year that took in around $1 billion worth cryptos. Apart from the US and China, the other most common locations for exchange security breaches were the UK, South Korea, and Japan.<\/p>\n \u201cWhile it is challenging to completely prevent breaches of security systems, particularly in relation to hot wallets, it is possible for exchanges to have proper insurance for special cases, an in-house security team, blockchain analytics software, and back-up reserves that are equivalent to the amount of crypto held in online storage,\u201d the company added.<\/p>\n The suggestions\/recommendations around cryptocurrencies in this story are by the respective commentator. Financial Express Online does not bear any responsibility\u202ffor their advice. Please consult your\u202ffinancial advisor before dealing\/investing in cryptocurrencies.<\/em><\/strong><\/p>\n<\/div>\n![\"Financial](\"https:\/\/www.financialexpress.com\/wp-content\/themes\/ie-network-theme\/assets\/src\/img\/telegram-icon.png\" "\\"Financial"){kind=icon}
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