Cybercriminals and hackers in the world of cryptocurrency may have a more fruitful year in 2024, potentially surpassing their accomplishments in 2023.
During the initial months of 2024, hackers managed to steal digital assets worth $542.7 million, marking a 42% increase compared to the same period in 2023.
The main reason behind this surge in attacks is the hackers’ continuous adaptation of their strategies and search for vulnerable targets, as stated by Mriganka Pattnaik, the co-founder and CEO of the crypto risk and intelligence platform Merkle Science.
Pattnaik explained to Cointelegraph that phishing attacks are a common tactic used by hackers to obtain sensitive information such as crypto wallet private keys. One specific form of phishing attack, known as address poisoning scams, involves deceiving investors into sending funds to a fake address that resembles ones they have previously used.
In a notable incident in May, a trader fell victim to a high-profile phishing attack, resulting in the loss of $71 million worth of cryptocurrency. The attacker managed to persuade the trader to transfer 99% of their funds to an address controlled by the hacker.
Interestingly, the perpetrator returned the stolen $71 million to the victim over a week later after the incident garnered attention from blockchain investigation agencies and the attacker’s location was identified.
While smart contracts are becoming more secure, hackers are still on the lookout for vulnerable targets. Previously, smart contract vulnerabilities were a prime target for cybercriminals. However, according to Merkle Science’s 2024 HackHub report, losses due to smart contract vulnerabilities decreased by 92% to $179 million in 2023 from $2.6 billion in 2022.
Currently, the biggest threat comes from private key leaks, accounting for over 55% of the total hacked digital assets in 2023.
The decline in smart contract exploits can be attributed to improved security measures and hackers shifting their focus to easier targets, according to Pattnaik.
The rising value of cryptocurrencies is attracting more hackers to the industry. Since the start of the year, cryptocurrency prices have soared significantly, with the total market capitalization increasing by 54% year-to-date, according to CoinMarketCap data.
This surge in crypto prices not only presents a larger bounty for hackers but also entices more cybercriminals to enter the cryptocurrency space, as highlighted by Pattnaik.
In May 2024, over $574 million worth of digital assets were lost in 30 separate crypto hacks, marking a 666% increase from the previous month, as reported by PeckShield on June 1.
Overall, the cryptocurrency industry continues to face threats from hackers and exploiters, who are constantly evolving their tactics to capitalize on the vulnerabilities within the digital asset space.