Cybercriminals stole $1.7 billion from crypto funds in 2023 as attacks proliferate
Hackers siphoned off $1.7 billion from cryptocurrency platforms in 2023 — down about $2 billion from the previous year’s record high, according to data compiled by blockchain research firm Chainalysis.
Despite the drop in total money lost, the number of individual incidents targeting these platforms increased from 219 in 2022 to 231 in 2023 – due in no small part to the collapse of several popular exchanges and the overall steep decline in the value of cryptocurrencies.
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Chain analytics experts also attributed the drop to a drop in cyber theft targeting decentralized finance (DeFi) platforms that allow customers to borrow funds, speculate on prices and trade coins.
“Hacker attacks on DeFi protocols were largely responsible for the huge increase in stolen cryptocurrency we saw in 2021 and 2022, with cybercriminals stealing over $3.1 billion in DeFi hacks in 2022. But in 2023, hackers stole from DeFi protocols just $1.1 billion,” he told the researchers.
“This represents a 63.7% year-on-year decrease in the total value stolen from DeFi platforms. In 2023, there was also a significant decrease in the proportion of all funds stolen by victims of the DeFi protocol.”
Despite the decline, several incidents occurred 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 hacks happen because platforms are poorly built and prioritize growth over robust security systems.
“Historically, most DeFi hacks have stemmed from vulnerabilities in the design and implementation of smart contracts – a large portion of the affected contracts we’ve examined have either not been audited at all or have been under-audited,” said Mar Gimenez-Aguilar, Chief Security Architect. and researcher at blockchain cybersecurity firm Halborn.
However, Gimenez-Aguilar noted that things are improving as many DeFi protocols increase security measures.
Chainalysis said it was likely a combination of lower overall DeFi activity and better security practices that contributed to the drop in losses last year.
“Although the total amount stolen from crypto platforms in 2023 has decreased significantly compared to previous years, it is clear that attackers are becoming more 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.”