5 Biggest cryptocurrency hacks in history
Updated: Aug 5, 2022
Author: Marie Gerland
Date of Publication: 03/08/2022
The first cryptocurrency appeared in 1989. Since then, the interest in cryptocurrencies has only increased. But it is since the creation of Bitcoin in 2009 that investing in cryptocurrencies became truly popular. Nowadays the market capitalization of cryptocurrencies is just below $1 trillion. However, with the rise of cryptocurrency investments, massive hacks appeared. Indeed, cryptocurrencies exchange platforms are the target of attacks every few months. Thus, we are going to focus on the 5 biggest cryptocurrency hacks in history.
The Hack of Coincheck: a loss of $534 millions
Coincheck is a Japanese cryptocurrency exchange platform created in 2012. In 2018, 523 million of NEM coins disappeared on Coincheck (representing $534 million). In particular, this is the largest theft of digital currency in the world. How has this huge hack happened? The NEM coins were in “hot wallets”, wallets always connected to the Internet. Because of this connection, they are more prone to cyberattacks. Thus, only one phishing attack was sufficient to steal the NEM coins in the hot wallets. This hack of Coincheck is highlighting security breaches on cryptocurrency exchanges.
Mt. Gox hacking in 2014
The second biggest cryptocurrency hack in history is the Mt. Gox hack. This hack took place in 2014. The loss comes at $460 million (corresponding to 850,000 Bitcoins). After this massive hack, Mt. Gox has filed for bankruptcy. However, it wasn’t the first theft on this exchange platform. Indeed, in 2011, $9 million disappeared again. The platform was responsible for the hacks because of a lack of security. Actually, coders could delete the lines of codes of others due to the absence of a code control software.
The Ku Coin Hack: a huge and recent hack
The amount of $281 million got lost in 2020 on Ku Coin exchange. This exchange platform appeared in 2013 in Singapore. In 2020, North Korean hackers stole Ardor, Bitcoin, Ethereum and Litecoin for $281 million. As for the Hack of Coincheck, the hackers have accessed hot wallets. Following the attack, the platform directly froze the assets. Thus, it made $204 million unusable by the hackers (out of the $281 million stolen). As a result, thanks to its responsiveness, the platform returned back 84% of the stolen assets.
BitGrail hacking: $170 millions lost
The hacking of the Italian exchange platform BitGrail took place in 2018. And it led to a loss of $170 million (corresponding to a hack of 17 million Nano coins). Actually, this loss of $170 million is the result of several thefts. After investigations, 2 tracks were available. First, the attack could come from the inside. Second, no additional security was put in place following the first attack. Indeed, the owner of the platform is suspected of having ripped off his customers and organized the bankruptcy. The police have not yet been able to bring to light the real culprits of this hack.
Quadrigacx: a misappropriation by the CEO
For Quadrigacx exchange platform, the situation is different than the previous hackings. Indeed, at the death of Gerald Cotten (CEO of Quadrigacx) in December 2018, a loss of $162 million was discovered. Between 2016 and 2018, the CEO would have helped himself in the accounts of his clients. And he traded cryptocurrencies for himself with this money. In fact, it is EY (Ernst and Young) who discovered the misappropriation and established a report detailing the case.
So, we have underlined the biggest cryptocurrency exchange platform hacks in history. Nowadays, more and more people decide to invest in cryptocurrencies. Actually, this is an easy type of investment because everything happens online. It is also faster than a few years ago thanks to the development of technologies. However, the risk of being hacked is then important. Therefore, it is essential to strengthen security measures on the cryptocurrency exchange platforms.