In the realm of cryptocurrency, hackers and exploiters are gearing up for a potentially more successful year in 2024, with the potential to surpass their achievements in 2023.
During the first quarter of 2024, hackers managed to steal digital assets worth $542.7 million, marking a 42% increase compared to the same period in 2023. This spike in theft can be attributed to hackers constantly changing their tactics and seeking out easier targets, as explained by Mriganka Pattnaik, the co-founder and CEO of Merkle Science, a crypto risk and intelligence platform.
Pattnaik explained to Cointelegraph that phishing attacks are a common method used by hackers to obtain sensitive information such as crypto wallet private keys. One type of phishing attack, called address poisoning scams, involves deceiving investors into sending funds to a fraudulent address that closely resembles one they have interacted with before.
In a notable incident in May, a trader fell victim to a high-profile phishing attack and lost $71 million worth of crypto. The attacker managed to dupe the trader into sending 99% of their funds to the attacker’s address. Surprisingly, the thief returned the stolen $71 million to the victim over a week later after blockchain investigation firms got involved and traced the attacker’s location.
While smart contracts are becoming more secure, hackers are still on the lookout for vulnerabilities in other areas. The “2024 Crypto HackHub Report” by Merkle Science revealed that funds lost to smart contract vulnerabilities dropped by 92% to $179 million in 2023, significantly lower than the $2.6 billion lost in 2022. Private key leaks remain a major concern, with over 55% of hacked digital assets being lost due to this in 2023.
The decrease in smart contract exploits can be attributed to advancements in security tools and hackers shifting their focus towards easier targets, according to Pattnaik. The surge in cryptocurrency prices this year has not only increased the potential rewards for exploiters but has also attracted more hackers to the crypto space.
In May 2024 alone, over $574 million worth of digital assets were lost in 30 separate crypto hacks, marking a 666% month-over-month increase, as reported by PeckShield on June 1.
As cryptocurrency valuations continue to rise, the risk of hacks and exploits remains a significant concern in the industry.