Vulnerabilities in crypto applications and chains are frequently used by malicious actors to steal money from unsuspecting users and project teams alike. They are using various ways to get a hold of assets – malicious programs stealing private keys, exploiting the loophole in the protocol or using backdoors to hack into the exchanges. Today, we will explore the top cryptocurrency hacks that happened in the past.
We’ll start with one of the most known exploits that happened back in 2014 and the aftereffects are still continuing to this day. The Mt. Gox crypto hack is one of the most prominent events in the history of the cryptocurrency world. Not only did it affect the reputation of the Bitcoin market, but it also had a massive impact on the security of digital assets.
During its peak in 2013, the Mt. Gox exchange was handling 70% of all the global transactions in the bitcoin currency. But at the time of the hack, the company was technically insolvent. So when the hack occurred, it was only natural that the company went down. This caused the price of Bitcoin to crash too – so both customers and market participants lost quite a large amount of money.
As a result, the Japanese government seized its assets. Some of the customers who were affected by the hack are still waiting for reimbursement of partially recovered Bitcoins. However, most of the remaining BTC has yet to be recovered.
It was a bad day for Ronin Network, the decentralized Ethereum sidechain for the popular Axie Infinity game. The company said it had been hacked for a whopping amount of money – over $615 million in USDC. This was the second largest crypto hack in history. It is also the largest DeFi hack to date.
The heist was made possible by a flaw in the Ronin Network’s cryptographic system. The attacker had access to four Ronin validators, as well as a third-party validator run by the Axie DAO. He used the hacked private keys to forge fake withdrawals. The hack was discovered six days after it occurred. The chain of transactions involving the stolen coins was tracked by Chainalysis.
After the hack was detected, Sky Mavis, the game’s parent company, locked down the Ronin bridge and increased the validator threshold to nine. The company has since reopened transactions. However, it has not responded to a number of requests for comment.
The Beanstalk Farms crypto hack happened back in April 2022, with over $76 million worth of crypto stolen.
Beanstalk Farms is a stablecoin protocol based on the Ethereum network. When it came under attack, its token plummeted by more than 80%. The attacker used a “flash loan” to perform the attack – this method is loved by malicious actors. The perpetrator stole more than 100 million Bean tokens, the native governance token for the platform, along with 24,830 native Ethereum tokens. They also gained control over 67% of the project’s governance.
According to a report from PeckShield, the culprit siphoned at least $80 million from the stolen funds. Most of the funds were transferred to Tornado Cash, a privacy-oriented cryptocurrency tumbler service.