Hackers siphoned $1.7 billion from cryptocurrency platforms in 2023 — down by about $2 billion from a record high set the previous year, according to data collected by blockchain research firm Chainalysis.
Despite the drop in total money lost, the number of individual incidents targeting these platforms grew from 219 in 2022 to 231 in 2023 — due in no small part to the collapse of several popular exchanges and the overall precipitous decline in value of cryptocurrencies.
Chainalysis experts also attributed the drop to a decrease in the number of cyber thefts targeting decentralized finance (DeFi) platforms — which allow customers to borrow funds, speculate on prices and trade coins.
“Hacks of DeFi protocols largely drove the huge increase in stolen crypto that we saw in 2021 and 2022, with cybercriminals stealing more than $3.1 billion in DeFi hacks in 2022. But in 2023, hackers stole just $1.1 billion from DeFi protocols,” the researchers said.
“This amounts to a 63.7% drop in the total value stolen from DeFi platforms year-over-year. There was also a significant drop in the share of all funds stolen accounted for by DeFi protocol victims in 2023.”
In spite of the drop, several incidents drew headlines throughout 2023, including:
- Euler Finance — $197 million loss;
- Curve Finance — $73.5 million loss;
- Mixin Network — $200 million loss;
- CoinEx — $43 million loss;
- Poloniex Exchange — $130 million loss;
- Kyber Network — $54.7 million loss;
- HTX — $113.3 million loss.
July 2023 alone saw 33 different hacks, the most of any month, the researchers explained.
Cybersecurity experts who spoke to Chainalysis said many of the hacks occurred because platforms are poorly built, prioritizing growth over robust security systems.
“Historically, the majority of DeFi hacks have stemmed from vulnerabilities in smart contract design and implementation — a large proportion of the affected contracts we examined had either not undergone any audit or had been audited inadequately,” said Mar Gimenez-Aguilar, lead security architect and researcher at blockchain cybersecurity firm Halborn.
But Gimenez-Aguilar noted that things are improving, with many DeFi protocols increasing security measures.
Chainalysis said it is likely a mix of lower overall DeFi activity and better security practices that contributed to the decline in losses last year.
“Although the total amount stolen from crypto platforms in 2023 was down significantly from prior years, it is clear that attackers are becoming increasingly sophisticated and diverse in their exploits,” Chainalysis said.
“Over time, as these processes improve, it is likely that funds stolen from crypto hacks will continue to decline.”
Image: ChainalysisOne important part of the crypto hacking ecosystem is the activity of threat actors from North Korea, which have pilfered billions from crypto platforms to help fund their government and its nuclear weapons program.
In 2022, North Korean cyber espionage groups like Kimsuky and Lazarus Group stole about $1.7 billion worth of cryptocurrency. That figure fell to $1 billion in 2023 but the number of incidents attributed to the nation grew to 20, the highest ever recorded.
About $428 million was stolen from DeFi platforms while exchanges, wallet providers and centralized services also saw hundreds of millions worth of losses.
Attacks on Atomic Wallet, Alphapo and Coinspaid were all attributed to North Korean hackers, according to U.S. law enforcement agencies.
Chainalysis said the hackers behind the attacks took great effort to obfuscate the funds, sending them to centralized exchanges and then to other platforms where they could be mixed with other funds and converted into other cryptocurrency.
The hackers used the now-sanctioned mixing service Sinbad to obscure the on-chain transactions. Several other platforms and services, like the Tron blockchain and Avalanche bridge, were used to further launder the money.
The United Nations Security Council recently asked researchers at cybersecurity firm Phylum to provide them with information on North Korea’s efforts to use cryptocurrency thefts as a way to circumvent sanctions.
Louis Lang, co-founder of Phylum, told Recorded Future News that the UN was particularly interested in Lazarus Group’s attacks and noted that they have seen multiple campaigns from the group.
“DPRK cyberattacks account for nearly 45% of their military budget. If memory serves, $3.7 billion in cryptocurrency was stolen in 2023, nearly half of that was the result of DPRK cyberattacks,” Lang said.
“In the campaigns we’ve been monitoring, [Lazarus Group] is just different because the motivations are different. The group wants to obtain cryptocurrency, so they target financial and cryptocurrency institutions directly. They’ve been very successful in this case.”
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Cybercriminals stole $1.7 billion from crypto funds in 2023 as attacks proliferated. Hackers siphoned $1.7 billion from cryptocurrency platforms in 2023 — down by about $2 billion from a record high set the previous year, according to data collected by blockchain research firm Chainalysis.
How much cryptocurrency was stolen in 2023? ›
In 2022, $3.7 billion was stolen, making it the biggest year for crypto theft. However, in 2023, stolen funds decreased by 54.3% to $1.7 billion despite an increase in individual hacking incidents from 219 to 231.
How much money has been stolen from crypto? ›
Hackers had stolen more than $1.38 billion worth of crypto by June 24, 2024, compared with $657 million in the same period in 2023, TRM Labs said in a report. The median theft was one-and-a-half times larger than the year before, the report said.
What crypto exchange was hacked in 2023? ›
Euler Finance: $197 Million
On March 13, 2023, hackers conducted a flash loan attack, grabbing $197 million in wrapped Bitcoin (wBTC), DAI (a MakerDOA stablecoin), staked ether (stETH), and USDC.
What is the largest cryptocurrency theft? ›
In May, Japanese cryptocurrency exchange DMM Bitcoin suffered a theft of bitcoin worth over $300 million at the time, marking the largest cryptocurrency-related attack so far in 2024, according to TRM's report.
What is the biggest crypto hack in history? ›
Perhaps the most high-profile of crypto trading hacks, cybercriminals targeted the Binance exchange in October 2022, eventually taking $570 million.
How much money have people lost in crypto? ›
As valuations tumbled, over $1.8 trillion of crypto value dissolved. Over $450 billion vanished during the market turmoil following the Terra/Luna collapse in May 2022 alone; another $200 billion was lost in the wake of the FTX bankruptcy in November 2022.
Is stolen crypto recoverable? ›
Full recovery: Unfortunately, full recovery of scammed crypto is not guaranteed. Scammers often move stolen funds quickly across complex networks, making them difficult to trace. Prevention is critical: While recovery is challenging, prevention is crucial.
Who stole the money in cryptocurrency? ›
Two Brothers Arrested for Attacking Ethereum Blockchain and Stealing $25M in Cryptocurrency. An indictment was unsealed today charging Anton Peraire-Bueno, 24, of Boston, and James Pepaire-Bueno, 28, of New York, with conspiracy to commit wire fraud, wire fraud, and conspiracy to commit money laundering.
What is the biggest crypto hack in 2024? ›
Crypto hacks had more than doubled in the first seven months of 2024, with stolen funds reaching $1.6 billion. The spike was driven by an increase in digital asset prices, including Bitcoin, which saw a record high. Asian exchanges were heavily targeted, raising concerns about the security of crypto platforms globally.
Bitcoin is considered hack-proof because the Bitcoin blockchain is constantly reviewed by the entire network.
What crypto exploded in 2023? ›
The year 2023 was one of the best years in the history of cryptocurrencies, as blue chip crypto tokens Bitcoin and Ethereum delivered their investors returns of over 155% and 90%, respectively. Meanwhile, the prices of some crypto coins (top 100 by market cap) increased by up to 9600% in 2023.
What is the number one crypto in 2023? ›
Who is the biggest crypto holder? ›
Satoshi Nakamoto owns the most bitcoin, with an estimated 968,452 BTC. Satoshi not only invented but was also the first miner to create blocks of transactions. Satoshi was rewarded with nearly one million bitcoin in cumulative block rewards for the work.
What is the most violent cryptocurrency? ›
The most volatile tokens around
Coin | Rank | Volatility 1M |
---|
FOR | 787 | 40.53% |
LBC | 804 | 39.85% |
COVAL | 770 | 39.33% |
VEGA | 788 | 38.12% |
48 more rows
How much money has been stolen from crypto wallets? ›
Crypto theft has surged in the first six months of 2024, now reaching $1.38 billion, a figure more than twice the amount stolen in 2023, according to new data from TRM, a blockchain intelligence company.
What is the crime report for crypto in 2023? ›
complaints received in 2023 was 60,468. Total losses of $5.6 billion were reported, experiencing a 45 percent increase in losses from 2023. The most reported crime type related to cryptocurrency is Investment.
What is the crypto scandal in 2023? ›
The former CEO of crypto exchange FTX, Sam Bankman-Fried, was found guilty of fraud related to the misuse of customer funds at the bankrupt company. Binance Holdings Ltd. and its CEO, Changpeng Zhao, pleaded guilty to criminal charges related to violations of the Bank Secrecy Act (BSA).
What is the value of cryptocurrency stolen each day on average? ›
Behind the numbers (TechCrunch):
If your assets are stolen, you're out of luck. Enabling secure access to these cryptocurrency assets is absolutely critical to preventing theft — which, as of the end of 2020, amounted to just over $10 million a day — and/or lockout of one's potential fortune.