During 2023, hacks were one of the main concerns of the cryptocurrency industry. Despite the bear market for part of the year, cybercriminals in the cryptocurrency sector did not stop.
North Korean hackers, led by the Lazarus Group, once again stood out as one of the biggest threats to the crypto industry in terms of security, with several selective attacks throughout 2023.
Cryptocurrency hacks 2023
Security continues to be one of the crucial points to work on in the crypto/blockchain industry.
The total number of hacks orchestrated by cybercriminals to protocols in the blockchain ecosystem closes 2023 with more than 445 attacks, according to figures from the firm SlowMist, the highest number of annual hacks in the history of cryptocurrencies.
2023 ends with 130 more attacks than in 2022 (312) and practically double than in 2021 (236).
In terms of total stolen cryptocurrency figures, 2023 saw a decrease in total stolen cryptocurrency funds.
SlowMist figures show nearly $2.4 billion stolen during the year, 50% less than in 2022 ($4.4 billion) and almost 75% less than in 2021 ($9.795 million).
For its part, TMR Labs estimates the amount of money stolen in cryptocurrencies at $1.7 billion. The firm reports a decrease of 50% compared to 2022. 60% of the stolen funds came from attacks on the infrastructure of the protocols (theft of keys, passwords, access to platforms and servers, among others).
The REKT database, published by De.Fi, estimates more than $1.8 billion in funds stolen from cryptocurrency hacks during 2023.
Biggest crypto hacks in 2023
Despite the decrease in stolen funds, the impact of the hacks has been very painful for the affected platforms and users. Let's look at a list of the top cryptocurrency hacks in 2023.
Mixin Network
Cross-chain platform Mixin Network suffered a hack in September due to a vulnerability in the database of its third-party cloud service provider. The theft allowed the attackers to drain between $150 and $200 million in crypto assets from their platform on the #Ethereum $ETH and #Bitcoin $BTC networks.
[Announcement] In the early morning of September 23, 2023 Hong Kong time, the database of Mixin Network's cloud service provider was attacked by hackers, resulting in the loss of some assets on the mainnet. We have contacted Google and blockchain security company @SlowMist_Team…
— Mixin Kernel (@MixinKernel) September 25, 2023
The platform offered a reward of $20 million to the hackers for the return of the funds, something that, as of the publication of this article, has not been successful. Mixin launched a new network and recovered much of its functionality. According to statements by its founder, Feng Xiaodong, the platform could cover up to 50% of the funds stolen from users.
Euler Finance
In February of this year, decentralized lending protocol Euler Finance suffered a flash loan attack that resulted in the loss of $197 million in DAI and USDC stablecoin assets, Wrapped Bitcoin (WBTC) and Staked Ethereum (stETH).
Unlike much of the attacks in the crypto space, the story had a “happy” ending. After pressure from Euler and his community, the hacker decided to return all of the stolen $197 million. The platform enabled a refund system so that users could claim the stolen funds.
Multichain
One of the most striking and mysterious cryptocurrency-related incidents of 2023 is the case of Multichain, a cross-chain bridge for asset transfer.
In July of this year, after several suspicious movements, $126 million was drained from the platform. Initially, it was reported that the attack had to do with the hackers' control of the platform's MPC nodes.
Days after the attack, the Multichain team acknowledged that its CEO, Zhaojun, the only one who had access to the MPC nodes, had been arrested by law enforcement authorities in China.
The platform announced its closure due to lack of funds and the infrastructure to continue operating, as Zhaojun completely controlled the protocol. Speculation about the Multichain case has given rise to unconfirmed theories that speak of a possible rug pull or an inside job.
1. On May 21, 2023, Multichain CEO Zhaojun was taken away by the Chinese police from his home and has been out of contact with the global Multichain team ever since. The team contacted the MPC node operators and learned that their operational access keys to MPC node servers had…
— Multichain (Previously Anyswap) (@MultichainOrg) July 14, 2023
Poloniex
The cryptocurrency exchange Poloniex was involved in a hack of more than $120 million in November, following a security breach in access to the platform.
The attacker managed to access the Poloniex hot wallet, draining millions in crypto assets from the #Tron , Ethereum and Bitcoin networks. Justin Sun, Poloniex's majority shareholder, tried unsuccessfully to influence the attackers to return all of the funds, with a $10 million reward. Despite the attack, the platform refunded users' funds and resumed operations shortly after the security incident.
We are investigating the hack incident. #Poloniex maintains healthy financial position and will fully reimburse the affected funds.
We are extending 5% 𝘄𝗵𝗶𝘁𝗲 𝗵𝗮𝘁 𝗯𝗼𝘂𝗻𝘁𝘆 to Poloniex hacker in exchange for the return of the funds to the following ETH/TRX/BTC wallets.— Poloniex Exchange (@Poloniex) November 10, 2023
The Poloniex team has successfully identified and frozen a portion of the assets associated with the hacker's addresses. At present, the losses are within manageable limits, and Poloniex's operating revenue can cover these losses.
— H.E. Justin Sun (@justinsuntron) November 10, 2023
HTX and Heco
HTX, formerly known as Huobi, and its mainnet, Heco Chain, reported more than $100 million in losses due to a joint attack in November.
In this attack, the thieves accessed the crypto exchange and the Heco Chain bridge and drained 12.5 million and 85 million in funds, respectively. Behind HTX is also Justin Sun, who interceded again to mitigate the million-dollar loss.
As HTX and Poloniex approach opening deposit and withdrawal, we will initiate an epic airdrop for users with assets. Please stay tuned! My deepest apologies to the users affected by the hacker attacks on HTX and Poloniex. We will cover the loss and All assets are are SAFE.
— H.E. Justin Sun (@justinsuntron) November 24, 2023
Other outstanding hacks
Atomic Wallet: The wallet suffered a hack in June of more than $100 million, 0.1% of its assets. Atomic, in collaboration with cryptocurrency exchanges, managed to freeze $2 million of the funds stolen in the hack.
Stake.com – Cryptocurrency casino and sports betting platform Stake.com recorded suspicious movements in September. The moves led to a hack of more than $41 million in cryptocurrencies and tokens in their hot wallets on the Ethereum and BNB Smart Chain networks. From the outset, the platform indicated that user funds were fully insured.
Curve: DeFi lending giant Curve Finance suffered a more than $70 million exploit in July, following an issue in the Vyper compiler in versions 0.2.15-0.3.0, which affected its liquidity pools, crv /eth, aleth/eth, mseth/eth and peth/eth.
North Korean hackers in the spotlight
The presence of North Korean hackers in cryptocurrency hacks in 2023 is significant. In fact, it is important to say that in several cases of the hacks cited, such as Stake.com, Atomic or Poloniex, responsibility points to the Lazarus Group. The FBI warned this year about the sale of cryptocurrencies carried out by North Korean hackers. According to cybersecurity company Recorded Future, more than $3 billion in cryptocurrencies have been stolen since 2017.
Source: Observatorioblockchain.com
