October becomes the Worst Month for Crypto-related Crimes

By Fizza Akbar ⏐ 3 years ago ⏐

3 min read

According to the crypto research firm, after four major hacks on Tuesday, October has seen $718 million stolen from decentralized finance projects across 11 hacks in only 11 days. One of those attacks was the QANX bridge, which revealed on Tuesday that it had been infiltrated, allowing hackers to withdraw $1.16 million.

The October attacks include the $586 million Binance Bridge theft, the $2.3 million Temple DAO hack, and the $117 million Mango Markets hack, to mention a few. According to a post-mortem by crypto security firm CertiK, the latest attack utilized two distinct addresses to influence the price of Mango’s native currency, $MNGO, then borrow against their own crypto as collateral. The hacker, in this case, then went online to Mango’s forums and offered to return the crypto in exchange for $70 million in USD stablecoin from Mango’s treasury.

And, even though blockchain proponents continue to tout the security of a continuous and immutable chain of data, cross-chain bridges remain a key target of hackers. Bridges are used to transmit cryptocurrency between two separate blockchains, and according to Chainalysis, three bridges were hacked this month, totaling over $600 million in cryptocurrency.

The frequency of attacks had actually decreased throughout the summer months, with Chainalysis stating in August that hacks appeared to pause with continued challenges with the crypto market. Since the May crypto crash, the world’s most popular currencies, like bitcoin and ether, have failed to regain the wealth lost during the 2021 bubble. Those keeping an eye on bitcoin prices have observed some significant drops as we enter this week, anticipating a U.S. employment report on Friday and the latest inflation reports.

According to Chainalysis, 2022 is on track to be the greatest year for hacks in terms of total money taken from a wide range of crypto and NFT businesses. So far this year, hackers have earned more than $3 billion from 125 attacks. This puts hackers on track to break the record set in 2021 of roughly $3.25 billion stolen in cyberattacks by the end of this year.

It’s also worth noting where most of these hacks originated this year. In prior years, such as 2019 and 2020, most hacks targeted crypto exchanges, mainly through gaining access to user accounts via phishing or hacking into the exchange’s internal networks. In 2021, hackers mostly targeted DeFi initiatives, an umbrella term for public crypto projects designed to eliminate middlemen and function as a currency exchange and payment mechanism independent of banks or authorities. It’s become so terrible for these DeFi enterprises that the FBI has issued a warning to average people contemplating investing their hard-earned cryptocurrency.

And, as more crypto hypemen promote new decentralized autonomous organizations (AKA DAOs) or the next big “hot wallet” application that allows users to use apps to manage crypto, there appears to be a new hack every day, demonstrating how you never really know which project will be the next to have its users’ crypto stolen.

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