2024 has been a year to remember in the crypto space, and not for the reasons we hoped. A staggering $2 billion has been lost due to an unprecedented wave of cyberattacks. Centralized exchanges and DeFi platforms alike have been hit hard, with hackers showing off their skills and pushing the boundaries of what we thought possible in the crypto wallet market. Let’s take a look at some of the most significant incidents of the year and the lessons learned.
Centralized Exchanges and DeFi: A Tough Year
Centralized exchanges (CEXs) have long been a prime target for hackers due to their centralized nature. When a CEX goes down, the fallout can be catastrophic. Just look at the DMM Bitcoin Exchange attack this year, which saw $305 million vanish after a private key compromise. It's a stark reminder of the risk factors involved in trusting a centralized entity with our funds.
On the other hand, DeFi platforms often wear their vulnerabilities on their sleeves, thanks to the open-source nature of their code. This year, 97% of stolen cryptocurrency was traced back to DeFi platforms, with smart contracts being the usual suspects. Despite the decentralized nature of many platforms, the potential for code exploits and flash loan attacks is ever-present. Yet, there’s a glimmer of hope: DeFi hacks have decreased by 25% in 2024 compared to 2023.
Noteworthy Hacks of 2024
The Orbit Chain hack stands out, where hackers accessed multi-sig signers and made off with over $80 million in stablecoins, ETH, and BTC. Meanwhile, the DMM Bitcoin hack saw almost 4502.9 BTC ($305 million) stolen. And, of course, there was the WazirX hack, attributed to the Lazarus Group, where $235 million was taken. This year, North Korean hackers were responsible for 61% of total crypto thefts, raking in approximately $1.34 billion across 47 hacks.
The Role of North Korean Hackers
State-sponsored hackers are often drawn to cryptocurrencies to fund their geopolitical agendas. North Korean hackers, particularly the Lazarus Group, have been involved in over $1.7 billion in thefts, often to support their country’s illicit programs. Cryptocurrencies allow these actors to avoid international financial regulations, providing a convenient revenue stream. The decentralized nature of cryptocurrencies also aids in their operations, allowing them to conduct hybrid warfare with minimal detection.
Security Measures: Multi-Sig Wallets
Multi-sig wallets have emerged as one of the best wallets 2024 has to offer. They provide an essential layer of protection against attacks, as multiple private keys are needed for transactions. This minimizes the risk of a single point of failure. Additionally, they help prevent internal fraud by ensuring no one party has complete control over funds. They require multiple approvals for transactions, enhancing transparency and accountability.
In a world still grappling with the challenges of accounting for cryptocurrency, the adoption of multi-sig wallets signals a commitment to robust security measures. As the crypto tools we use continue to evolve, it’s clear that the need for strong security protocols will only grow.
This year has been a rollercoaster, and with the crypto challenges we face, staying informed is more crucial than ever.
