The crypto industry has faced persistent challenges, particularly from hacks and protocol exploits throughout the years. On a positive note, the volume of hacks decreased by over 50% compared to the previous year [2022].
According to TRM Labs, hackers pilfered an estimated $1.7 billion in cryptocurrency funds in 2023, marking a significant drop from the $4 billion recorded in 2022. Despite the overall decrease in losses, individual projects still suffered substantial thefts of large sums of money.
Throughout the year, several noteworthy hacking incidents garnered attention, affecting prominent entities such as Multichain, Euler Finance, Mixin Network, and Atomic Wallet.
In this article, we explore the 10 major cryptocurrency thefts of 2023 delving into the affected projects and analyzing the factors that contributed to each of these attacks.
1.) Mixin Network – $200 Milion
Mixin Network, a crypto project based in Hong Kong, experienced the most significant cryptocurrency exploit of the year [2023].
In September 2023, the company had to abruptly halt its operations as hackers managed to steal $200 million from users’ hot wallets.
According to Mixin, the hackers targeted the database of its cloud service provider. Although the firm did not offer additional details, analysts speculate that the compromised database might have contained the private keys to users’ accounts – the confidential phrases used to access their cryptocurrency holdings.
2.) Euler Finance – $195 Million
The flash loan attack on Euler Finance in March 2023 led to losses exceeding $195 million and triggered a contagion effect across various decentralized finance (DeFi) protocols. Apart from Euler, at least 11 other protocols experienced losses due to the attack.
In a surprising turn of events, the attacker returned all the exploited funds over the next 23 days. This brought considerable relief to many Euler users who had been affected by the initial attack.
3.) MultiChain – $125 Million
In July 2023, the cross-chain bridge, MultiChain, fell victim to an exploit, resulting in the loss of $125 million in cryptocurrencies across various blockchains it supported.
The largest sum of funds was taken from the Fantom blockchain. Notably, this incident unfolded shortly after the bridge was temporarily halted, with the team citing ‘multiple issues due to unforeseeable circumstances.’
While an explanation has not been given for the incident, analysts point to the compromise of the private keys associated with the smart contracts of the MultiChain bridge. Hackers exploited vulnerabilities in the code to carry out the attack.
Concerns have been raised about the potential involvement of the team in the incident, fueled by the disappearance of MultiChain’s CEO, Zhaojun, just before the hack. Before the event, he was arrested by Chinese authorities, and it was later revealed that he had exclusive control over the protocol’s funds, contradicting MultiChain’s previous claims of decentralization. Currently, the MultiChain bridge is not operational.
4.) Poloniex – $120 Million
In November 2023, hackers believed to be associated with the North Korean Lazarus Group reportedly drained a remarkable $120 million from Poloniex’s hot wallets, possibly by gaining unauthorized access to private keys.
The aftermath was as expected, with trading and withdrawals coming to a halt. In response, the exchange announced its commitment to reimburse users who were affected by the incident. Poloniex, which has functioned as a centralized exchange since 2014, came under the ownership of Tron Founder, Justin Sun, in 2019.
5.) Atomic Wallet – $100 Million
In June 2023, the cryptocurrency wallet app, Atomic, suffered a significant security breach, leading to the complete depletion of user wallet accounts. Hackers managed to pilfer over $100 million worth of assets from approximately 5,500 users.
The exact cause behind the incident remains uncertain as Atomic has not yet provided an explanation for the security breach. There are suspicions that the exploit might have been triggered by code vulnerabilities identified by security analysts at Least Authority a year before the incident.
6.) Heco Bridge (HTX) – $86 Million
In November 2023, a significant exploit occurred on Heco, a primary cross-chain bridge established by the HTX exchange, formerly Huobi. The attacker gained control over the bridge’s main smart contract or operator account, leading to the theft of more than $86 million in various cryptocurrencies.
Preliminary analysis indicate that the intruder tampered with the smart contract code of the bridge and managed to bypass its security protocols. This manipulation enabled the hacker to create unauthorized tokens through the bridge contract, which were then exchanged for Ether and subsequently transferred out of the bridge.
7.) Curve – $73 Million
In July 2023, Curve Finance, one of the prominent decentralized exchanges in the DeFi space, experienced a significant attack.
Multiple liquidity pools on the platform were exploited due to a vulnerability in the Vyper programming language it had utilized. This security flaw led to hackers pilfering approximately $73 million in various cryptocurrencies.
Responding swiftly, the Curve team patched the vulnerability, and in the aftermath, they managed to recover about $50 million, which accounted for 70% of the stolen funds. This effort alleviated concerns for many users and stakeholders affected by the security breach.
8.) CoinEx – %55 Million
In September 2023, the centralized cryptocurrency exchange, CoinEx, based in Hong Kong, reported a significant security breach. Hackers managed to breach the exchange’s hot wallets, intended for immediate transactional use, and made off with over $55 million in various cryptocurrencies.
Once again, the North Korean hacking group, Lazarus, was suspected of involvement in this incident concerning the hack of CoinEx.
9.) KyberSwap – $54 Million
In November 2023, decentralized exchange (DEX) aggregator, KyberSwap, fell victim to an exploitat through an attack on its Elastic platform, resulting in the theft of approximately $54 million in cryptocurrencies.
The exploit was rooted in a vulnerability within the tick interval boundaries of Kyber’s concentrated liquidity pools enabling the attacker to artificially double the liquidity and deplete its value.
In an attempt to negotiate, Kyber offered a 10% white hat bounty to the hacker with the condition of returning the funds. However, the hacker displayed no interest in accepting the bounty and instead made unconventional demands in an on-chain message. These demands included asking for complete control over the project.
10.) Stake.com – $41 Million
In September 2023, the crypto-based betting platform, Stake.com, experienced a significant security breach, likely due to a private key exploit of its wallets. An estimated $41 million worth of cryptocurrencies were stolen from the platform.
In a subsequent report, the FBI attributed the attack to Lazarus hacking group, based on its analysis of the addresses receiving stolen funds from Stake.com across Ethereum, BNB Chain, and Polygon networks.
