2021 Had Six Different Cryptocurrency Heists Over $100 Million

More than 20 different times in the last 12 months, at least $10 million was stolen from a cryptocurrency exchange or project, reports NBC News.

“In at least six cases, hackers stole more than $100 million…”

By comparison, bank robberies netted perpetrators an average of less than $5,000 per heist last year, according to the FBI’s annual crime statistics… “If you hack a Fortune 500 company today, you might steal some usernames and passwords,” said Esteban Castaño, the CEO and co-founder of TRM Labs, a company that builds tools for companies to track digital assets. “If you hack a cryptocurrency exchange, you may have millions of dollars in cryptocurrency…”

[W]hile a handful of countries have strict regulations in place, it’s relatively easy for tech entrepreneurs to set up an exchange nearly anywhere in the world and run it however they like. Cryptocurrencies generally offer a certain amount of security — taking their name, in part, from “encryption.” But the exchanges that manage them, especially new ones building their businesses from scratch, often start with a tiny staff, which means few if any full-time cybersecurity professionals. Their developers may work frantically to make the code work, sometimes accidentally leaving flaws that give hackers a foothold. Combined with the fact that a volatile market often leaves them suddenly holding a fortune, exchanges are a particularly ripe target for criminal hackers…

The problem is exacerbated because many cryptocurrency projects, intent on avoiding government regulations, set up in countries whose law enforcement agencies don’t have much power to go after transnational hackers. Or if they are hacked, they tend to be less likely to call for government help on ideological grounds, said Beth Bisbee, head of U.S. investigations at Chainalysis, a company that tracks cryptocurrency transactions for both private companies and government agencies. Some developers “want to be anti-bank and anti-oversight,” Bisbee said. “So when something like that happens, they’re not necessarily wanting to work with law enforcement, even though they’d be considered to be a victim and it’d be valuable for them to.”
Ultimately the article points out that “Most exchange hackers are not caught.” (Although in at least one case part of the stolen money was voluntarily returned.)

But what happens after the breach, NBC News asked Dave Jevans, the founder of CipherTrace, a company that tracks theft and fraud in cryptocurrencies.If an exchange is wealthy enough and plans ahead to have an emergency fund, it can compensate its customers if its operation is hacked, Jevans said. If not, they often goes out of business. “Not every exchange is so wealthy or has so much foresight. It just goes, pop, ‘We’re out of business. Sorry, you’re all screwed,’” he said.

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