The 2021 global cryptocurrency market was largely defined by hacking incidents and heists that only grew in scale over the course of the year, according to Gizmodo. Experts say that increased media attention and the rise of crypto prices are to blame for recent security breaches.
“What’s clear from the majority of these attacks this year is that it’s often a vulnerability that’s being exploited,” Rebecca Moody, head of research at Comparitech, said. “With the industry growing at an exponential rate and relying on open-source technology, this leaves platforms open to exploitation when hackers are able to find a weakness in the code.”
A Crypto Head study published in August reported over 30 incidents since the start of the year, with losses amounting to nearly $3 billion. Cryptocurrency hackers have stolen more than $1 billion within the last five months alone, according to Futurism.
Last summer, $600 million was siphoned from the decentralized finance (DeFi) platform Poly Network in one of the year’s largest heists. Four months later, hackers stole at least $150 million from crypto exchange Bitmart.
“Crypto exchange hacks are fairly common,” CoinGecko co-founder and chief operating officer Bobby Ong told CNBC. “Exchanges are a honeypot for hackers because of the high potential payoff for any successful exploit.”
Crypto hackers are so often able to elude punishment for their crimes because “cryptocurrency is virtually untraceable and easily disguised by laundering it through wallets in a matter of minutes,” according to Crypto Head co-founder Adam Morris.
The global anti-money laundering watchdog Financial Action Task Force insists that cryptocurrencies must be regulated globally, or else large-scale criminal activity and malfeasance will only spiral further out of control.