A blog about the biggest losses and theft in the cryptocurrency market from beginning till present.
The Mt Gox incident is one of the most infamous Bitcoin hacks, with 850,000 Bitcoins lost when attackers were able to find a way to withdraw funds from the exchange even though they didn’t own them. This hack happened because of a vulnerability in the code that allowed someone to overwrite a transaction, which in turn led to an overflow that let people spend Bitcoins they didn’t actually have. The hack happened over a period of three years and was finally discovered by Mark Karpeles and other developers working for Mt Gox.
As the cryptocurrency market is growing bigger, the number of security breaches is growing steadily as well. The average value of a theft per incident has increased threefold since 2017, while the number of incidents has fallen by nearly 60%.
It’s not surprising that Bitcoin, the world’s first digital currency, remains the most popular target for cybercriminals and fraudulent activities. But other cryptocurrencies are also getting their fair share of hacks and thefts.
In this article, we will discuss some of the biggest cryptocurrency hacks, thefts and losses that took place in the market. We will also discuss how these incidents affected the crypto market and what we can learn from them. And if you want to start trading cryptocurrencies without worrying about keeping them safe and secure, you can always sign up for a CryptoFlip account.
Cryptopia Hack (2018)
The concept of cryptocurrency has been around for a while, but only in the last few years has cryptocurrency evolved from an idea to a working technology. The first cryptocurrency, Bitcoin, was created in 2009 and quickly gained traction. There are now over 6,000 different cryptocurrencies available for trade on the market.
The total market capitalization of all cryptocurrencies stands at over $420 billion as of May 2020. While it is great to see such a large number of investors getting into crypto, it also means that there are a lot more people who could become victims of scams or hacks. It is crucial for new crypto investors to be aware of the potential risks that come with trading cryptocurrency or even just holding it in a wallet or on an exchange.
In this article, we explore the most substantial hacks and losses in the history of cryptocurrencies alongside those that have happened recently.
“Not your keys, Not your coins’ is a well-known phrase in the cryptocurrency space. It reminds investors that they do not really own their cryptocurrencies if they leave them on exchanges or other third parties like custodians. Since the inception of Bitcoin, people have lost millions of dollars worth of cryptocurrency through hacks and theft. Here are some examples of the biggest losses to date:
The first major hack in the crypto space happened in March 2014 when Mt Gox, then the world’s largest Bitcoin exchange, filed for bankruptcy after losing around 850,000 bitcoins to hackers. The breach was said to be due to a lack of security measures such as two-factor authentication.
In August 2016, hackers stole 119,756 Bitcoins from Bitfinex’s hot wallet which were valued at approximately $72M at the time and $1.7B today. Upon hearing the news, Bitcoin price fell 20% in 36 hours before recovering a few days later.
In February 2018, BitGrail disclosed that 17 million Nano tokens (then valued at $195M) had been stolen from its hot wallet due to fraudulent transactions. It was later discovered that there were vulnerabilities in Nano’s code that allowed hackers to pull
The cryptocurrency market has been under a lot of pressure lately, especially with the latest bitcoin crash, but it seems that hackers are also trying to take advantage of the situation.
Over the past few weeks there have been many stories about cryptocurrency thefts. One of them involved NiceHash, a Slovenian company that lets users sell their computing power for Bitcoin. According to reports, hackers managed to steal $68 million worth of Bitcoin from NiceHash wallet.
Another recent case involved Tether (USDT). This cryptocurrency operates on top of Omni Layer and Bitcoin blockchains so it can’t be mined. It was created as a means to transact faster and more easily on exchanges than with bitcoin. Tether has been a point of controversy in the crypto community because most people consider it to be a scam or Ponzi scheme, yet it is still one of the most popular cryptocurrencies today.
Just recently, almost $31 million worth of Tether tokens were stolen from a treasury wallet by an unknown hacker. The incident happened on November 19th and was announced by Tether’s official Twitter account:
“$30,950,010 USDT was removed from the Tether Treasury wallet on November 19, 2017 and sent to an unauthorized bitcoin address.”
The history of cryptocurrency is littered with the corpses of dead coins. Less than two decades since the first Bitcoin block was mined, the industry is a graveyard of failed experiments.
But it’s not just failed competitors that litter the crypto landscape. Much of this carnage is self-inflicted, as exchanges, wallets and miners lose cryptocurrency to hackers and scammers.
Crypto Crime: A $1.2 Trillion Industry
Since 2010, there have been over 40 million reported cases of cryptocurrency fraud. The total amount stolen comes to an impressive $1.2 trillion in BTC, ETH and stablecoins alone, although the actual figure is likely to be much higher. Some estimate that up to 10% of all crypto assets in circulation have been stolen by hackers at some point.
The largest heists usually involve exchanges — centralized platforms where users can buy, sell and store their digital assets — with the most notable being Mt Gox (2011), Bitfinex (2016), Coincheck (2018) and Bithumb (2019). However, it’s not just exchanges that are at risk from cybercriminals; wallet providers and other service providers have also lost billions of dollars worth of digital assets over the years.
The following is a list
1.Mt. Gox: (Bitcoin)
February 2014, Tokyo-based exchange Mt. Gox filed for bankruptcy after losing 744,400 bitcoins, which were worth $350 million at the time and $4.4 billion today. Hackers had been attacking the exchange for years and had stolen bitcoins from customer accounts, but CEO Mark Karpeles says no money was lost. According to him, a bug in the exchange’s software allowed hackers to steal the coins over a period of years without anyone noticing it. Today, 200,000 of those bitcoins have been found, but the rest remains missing.