Most members of the crypto community have hailed blockchains as impregnably secure. However, those outside the crypto space wonder why blockchain-based projects still get hacked. Unfortunately, some of these blockchains are not as invulnerable as many initially thought.
As public interest in crypto continues to grow, fraudsters and hackers have found ways to access various blockchain-powered protocols to steal cryptocurrencies. In 2022 alone, crypto users lost digital assets worth $3.7 billion to hackers. To be fair, most of the stolen crypto assets were from DeFi (Decentralized Finance) platforms, with cross-chain bridges, which allow users to move funds from one chain to another, being the most targeted.
The first major hack in crypto happened in 2011. Since then, several hack incidents have been reported, with crypto enthusiasts losing millions. Here are the boldest hacks in the crypto history.
Mt.Gox Exploit
The fallen cryptocurrency exchange Mt.Gox is popular for being the first target of a major hack. In 2011, the trading platform was exploited for 25,000 Bitcoins, worth approximately $420,000 at the time. Three years later, Mt.Gox lost 750,000 BTC, valued at $475 million. The amount of Bitcoin stolen from Mt.Gox in 2014 accounted for 7.2% of the circulating supply that year.
Binance’s BNB Hack
Binance, the biggest crypto exchange by trading volume, has not been spared by hackers. In 2022, it lost nearly $575 million in BNB when hackers exploited a vulnerability in the token’s smart contract to create 2 million BNB coins and successfully sold them for fiat.
FTX’s $600 Million Hack
The now-bankrupt crypto exchange FTX was targeted by hackers on the day news emerged that it had filed for bankruptcy. Over $600 million in various cryptocurrencies was lost. It appears that the exploiters took advantage of the internal turmoil at FTX. While most of the funds were stolen from the exchange’s wallet, a number of FTX users were also affected.
Ronin Network Hack
The attack on Ronin Network remains the biggest hack in cryptocurrency history. In March 2022, hackers gained access to Ronin Network, a protocol that powers popular play-to-earn game Axie Infinity, to steal USDC and Ethereum tokens worth $626 million. United States officials linked Lazarus Group, a notorious cybercriminal organization in North Korea, to the hack.
Poly Network Attack
In 2021, DeFi protocol Poly Network was exploited for $610 million by a single hacker. At the time, the team behind the project pleaded with the attacker to return the cryptocurrencies. Surprisingly, the anonymous hacker returned half of the stolen funds 48 hours after executing the attack. They said that they exploited Poly Network “just for fun.”
Wormhole Exploit
In mid-2022, well-known bridge service Wormhole was exploited, with the hackers pocketing $325 million. Fortunate for the bridge users, Womhole’s parent company, Jump Trading, was able to replace the stolen crypto within a few hours after the hack.
Nomad Hack
In August 2022, another bridge, Nomad, saw over $180 million in various crypto assets disappear after hackers exploited a vulnerability in the project’s code multiple times. The first hacker made away with $60 million. Other hackers stole the remaining balance before Nomad developers could fix the vulnerability.
Attacks on Governance Protocols
Besides exploiting crypto projects’ smart contracts, some bad actors have also executed the “51% attacks” on various governance protocols. Such attacks happen when someone takes control of a protocol by manipulating its governance system. Last year, stablecoin platform Beanstalk Farms lost over $78 million after a bad actor manipulated the project’s governance system to pass proposals that allowed them to withdraw the funds.
Meanwhile, crypto hacks are still on the rise in 2023, according to data from blockchain analytics firm Immunefi. The company says over $2 billion has already been stolen. Some of the crypto projects that have come under attack in recent months include DeFi protocols Mixin Network and Multichain, along with crypto exchanges CoinEx and HTX. Immunefi reports that Lazarus Group has been behind most of this year’s attacks.
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