According to a report by TRM Labs, hack volumes in 2023 decreased by over 50% compared to the previous year [2022].
Despite the stability in the number of attacks, which stood at 160, the amount stolen by cybercriminals through November 2023 totaled $1.7 billion. This figure is less than half of the nearly $4 billion lost to hacks in 2022.
Infrastructure attacks made up nearly 60% of the total amount stolen. Among these, the most detrimental type of attack was private key theft or seed phrase compromise. In such incidents, hackers exploit vulnerabilities in the underlying infrastructure of a cryptocurrency system, including servers, networks, or software, to gain unauthorized access and either steal funds or manipulate trades.
These infrastructure attacks, with an average of nearly $30 million per incident, were notably larger on average compared to protocol attacks and code exploits. The latter two combined accounted for a fifth of the total hack volumes.
Similar to the pattern observed in 2022, a limited number of large-scale hacks dominated cryptocurrency thefts in 2023. The top ten hacks collectively accounted for nearly 70% of all stolen funds. Notably, several of these breaches surpassed the $100 million mark, including:
- Attacks against Euler Finance in March 2023
- Multichain in July 2023
- Mixin Network in September 2023
- Poloniex in November 2023
According to TRM Labs, the cryptocurrency industry has substantially enhanced its security protocols, incorporating measures such as real-time transaction monitoring and anomaly detection systems. These advancements play a crucial role in safeguarding digital wallets and exchange platforms by enabling the identification and prevention of potential security breaches before they can materialize.
Moreover, law enforcement agencies worldwide intensified their focus on cybercrime involving digital currencies. The increased collaboration between law enforcement agencies has led to quicker responses to hacking incidents. It has also been instrumental in tracing, freezing, and recovering stolen assets, deterring potential hackers with the heightened risk of detection and prosecution.
Cryptocurrency exchanges, wallet providers, and blockchain networks have ramped up information-sharing about vulnerabilities, threats, and breaches. This collective approach towards security has fostered a more unified front against cybercriminals, making it increasingly challenging for hackers to exploit systemic weaknesses.
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