TRM Labs recently published a report about criminal activity in the crypto space. According to the research firm, the first half of the year saw hackers double their crypto spoils.
The report revealed that between January 1st and June 24th, hackers looted crypto worth $1.38 billion.
This was more than double during the same period last year when they had looted crypto worth $657 million.
The attacks
2024 saw a repeat of the pattern seen last year, where most of the crypto that was plundered was through a handful of large attacks.
70% of the amount of crypto stolen in the first six months of the year was compromised in five hacks.
TRM Labs revealed that seed phrase and private key compromises were the top attack vectors this year.
A seed phrase is used to recover or access a crypto wallet. This sequence of random words is stores the information required for unlocking said wallet.
This year, the largest heist occurred on DMM Bitcoin. The Japanese crypto exchange lost bitcoin valued at over $300 million. Address poisoning and stolen private keys were used by hackers.
The former involves criminals using a wallet that has an address similar to the recipient’s or the user’s to send a small amount of crypto.
The goal is to confuse the victims so they end up sending funds to the wrong wallet. It is difficult to memorize crypto addresses, given that they are a complex string of characters.
Entering them manually usually leads to mistakes.
No difference
According to TRM Labs, the security of the crypto ecosystem has not seen any fundamental change that may have led to the rise in attacks.
It added that the attack vectors, or the number of attacks were not significantly different as compared to last year.
However, the firm did note that the first half of the year did see higher average crypto prices. This could also be the reason behind the increase in the value of attacks.
The targets
Crypto companies have become common targets for cyberattacks and hacks. In 2014, Mt. Gox suffered from many hacks. This resulted in the crypto exchange filing for bankruptcy.
The hackers were able to get away with 950,000 BTC tokens, which are valued at more than $54 billion at today’s prices.
Heco Chain and HTX Exchange saw about $115 million stolen from them in November. The two crypto platforms are linked to Justin Sun, a renowned crypto entrepreneur.
TRM Labs asserted that crypto companies can minimize the threat of exploits and hacks. They would need to come up with a multi-layered defense strategy to do so.
This includes measures, such as implementing robust encryption protocols and conducting routine security audits. The research firm said that companies also need to educate their employees.
They need to come up with a comprehensive incident response strategy to deal with exploits and hacks in the crypto space.