Crypto had a rough year last year with the FTX collapse, price drops, and company bankruptcies, but there is another huge problem in the market—stolen funds.
Key Details
- More than $3 billion in cryptocurrency was stolen in 125 hacks in 2022, according to Chainalysis.
- Blockchain bridges that allowed users to move coins from one account to another were the hacks’ main target, totaling around 70% of the stolen assets.
- The top eight crypto hacks, according to Forbes…
- Ronin Network ($625 million)
- Wormhole Network ($325 million)
- Nomad ($190 million)
- Beanstalk Farms ($182 million)
- Mango Markets ($112 million)
- BNB Smartchain ($110 million)
- Harmony Horizon Bridge ($100 million)
Why it’s news
This year was rough for cryptocurrencies as the market faced price drops, failed businesses, the FTX collapse, and stolen funds. More than $3 billion in cryptocurrency was stolen in 125 hacks, according to Chainalysis.
Cryptocurrencies are still a relatively new market, and the recent failures have brought many problems to light, showing what needs to be done to move forward.
Some $3 billion in stolen funds for the year is a huge number, and most of the funds were stolen from blockchain bridges amounting to 70% of the stolen digital assets.
The bridges are used to move the coins from one account to another, but as users move the coins, they are temporarily held in the “bridge” until it can be moved to the other blockchain giving an open door to hackers to steal the coins.
“In retrospect, there were a lot of cutting corners for expediency,” says Sam Williams, CEO of blockchain security firm Arweave. “As an industry, we did not do well enough in calling out poor quality designs across the board.”
These problems have led U.S. regulators to call for crypto regulation as the market has been unregulated, leaving it open to many problems. Many leaders think rules need to be put in place to avoid future disasters within the market.