Crypto hacking remains a persistent threat, with the past four years each seeing more than a billion dollars worth of crypto stolen. 2024 marks the fifth year of growing crypto losses to hackers, highlighting how the rise in crypto adoption and prices increases the amount that can be stolen.
A recent report from Chainalysis reveals that funds stolen increased by approximately 21.07 percent year-over-year to $2.2 billion in 2024. The number of individual hacking incidents also increased from 282 in 2023 to 303 in 2024.
Upward trend slows in H2 2024
The intensity of crypto hacking shifted about halfway through the year. In its mid-year crime update, Chainalysis noted that the cumulative value stolen between January 2024 and July 2024 had already reached $1.58 billion, approximately 84.4 percent higher than the value stolen over the same period in 2023.
Through the end of July, the ecosystem was easily on track for a year that could rival the $3 billion+ years of 2021 and 2022. However, 2024’s upward trend slowed considerably after July, after which it remained relatively steady.
Targeting centralized services rises
In most quarters between 2021 and 2023, decentralized finance (DeFi) platforms were the primary targets of crypto hackers. “It is possible that DeFi platforms were more vulnerable because their developers tend to prioritize rapid growth and bringing their products to market over implementing security measures, making them prime targets for hackers,” stated Chainalysis.
Although DeFi still accounted for the largest share of stolen assets in the first quarter of 2024, centralized services were the most targeted in Q2 and Q3. Some of the most notable centralized service hacks include DMM Bitcoin and WazirX.
This shift in focus from DeFi to centralized services highlights the increasing importance of securing mechanisms commonly exploited in hacks, such as private keys. Private key compromises accounted for the largest share of stolen crypto in 2024, at 43.8 percent.
Given that centralized exchanges manage substantial amounts of user funds, the impact of a private key compromise can be devastating. For instance, the $305 million DMM Bitcoin hack is one of the largest crypto exploits to date, and may have occurred due to private key mismanagement or lack of adequate security.
North Korean hackers steal more than ever before
Hackers linked to North Korea have become notorious for their strategies, often employing advanced malware, social engineering, and cryptocurrency theft to fund state-sponsored operations. In 2023, North Korea-affiliated hackers stole approximately $660.50 million across 20 incidents. In 2024, this number increased to $1.34 billion stolen across 47 incidents, a 102.88 percent increase in value stolen.
These figures represent 61 percent of the total amount stolen for the year and 20 percent of total incidents.
One notable example of a North Korea-affiliated hack in 2024 involved the Japanese cryptocurrency exchange, DMM Bitcoin, which suffered a security breach resulting in the loss of approximately 4,502.9 Bitcoin, valued at $305 million at the time. The scale of the breach and the subsequent operational challenges led DMM to decide to shut down the exchange in December 2024.
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Predictive technologies to tackle crypto hacking
With the rise of crypto hacking, emerging tools and predictive technologies are paving the way to potentially prevent such incidents before they occur. Advanced predictive technologies are transforming cybersecurity by enabling real-time detection of potential risks and threats, offering a proactive approach to safeguarding digital ecosystems.
To combat these challenges effectively, a collaborative approach between the public and private sectors is essential. Data-sharing initiatives, real-time security solutions, advanced tracing tools, and targeted training can empower stakeholders to quickly identify and neutralize malicious actors while building the resilience needed to safeguard crypto assets.
