Biggest Cryptocurrency Hacks of All Time

Cryptocurrencies have changed the way financial transactions work around the world and the way people invest their money. A large number of people have traded on a crypto exchange at least once in their lives.

While cryptocurrencies have become overnight millionaires and the blockchain technology that enables crypto offers high levels of anonymity and security, they are also not immune to cybercrime. In the past year, some cryptocurrency hacks in 2022 have hit the news many times. In this blog, we cover the biggest crypto hacks of all time.

Cryptocurrencies have been around for quite some time, with Bitcoin being created way back in 2009. Seeing how over a decade has passed since the inception of this new technology, it should come as no surprise that it has experienced its fair share of problems and crises. There have been many cases of cryptocurrency hacking and theft. Billions of dollars worth of crypto disappeared down the rabbit hole of the hacking community, and most tokens were never seen again.

Considering the size of the crypto market as a whole and the unreal amount of money being invested in numerous projects and tokens, it’s almost surprising that we haven’t seen a lot more compromises in cryptocurrency exchanges.

Only Bitcoin alone once held a $1.28 trillion market cap, making it one of the hottest properties in the world. additional, Blockchain security What makes this possible is considered immutable, which makes the property even more attractive.

The problem of crypto hacks is highlighted by the fact that most people who put their money into cryptocurrencies had a very limited understanding of this industry, of the blockchain and how things worked, making them prime victims. Let’s take a look and see which crypto hacks were the biggest and what the consequences were.

Ronin chain – 625 million dollars

The largest cryptocurrency hack to date occurred in March 2022 when hackers made off with Ethereum and USDC worth approximately $620 million. According to Ronin Network, this hack affected the authentication nodes of Sky Mavis, a developer behind the game Axi Infinity, one of the biggest crypto games at the time.

The worst thing about this hack is that Ronin Network and Sky Mavis failed to detect that this hack happened, and it only came to their attention when one user failed to withdraw his crypto from the network.

It was made even worse, as at the time of the hack, Ronin Network had lowered its security, following a major Axi Infinity update a few weeks earlier. With decreased security, hackers were able to gain access to private keys of various wallets and fake withdrawals. This could have been easily prevented as it happened entirely due to the security being lowered in order to release the update.

The Ronin Network and Sky Mavis then began working with various US government agencies to try and recover these funds but were unable to achieve significant success.

Binance Managed to recover $5.8 million, but that was a small fraction of what was stolen. Following the investigation, it is believed that this crypto hack was engineered by North Korean hackers operating from China, meaning that the US had very little power to do anything in this case.

Poly network – 611 million dollars

Not every hack has to have a tragic ending, and the Poly Network hack incident is a good example of that. This hack occurred on August 10, 2021, when a hacker managed to steal more than $600 million worth of cryptocurrency from the DeFi platform.

As reports began to surface, Poly Network determined that the cause of this hack may have been the leaking of private keys used to sign their wallets. Additional reports stated that the hacker found a bug in the Poly Network that gave them the ability to sign transactions without the need for private keys. In total, $611 million worth of crypto disappeared, which consisted of cryptos like Ethereum and wrapped Bitcoin, USDT and Shiba Inu.

Poly Network even went so far as to share the addresses of crypto wallets where funds were transferred and encouraged various exchanges and networks to search for stolen funds. This action led to Tether freezing $33 million of USDT.

But as we mentioned at the beginning, this story has a somewhat happy ending. Following these events, the Poly network tried to communicate with the hacker using various online methods, and to their surprise, they received an answer.

The hacker then stated that they intended to return all the stolen crypto and that they only did so to point out the network’s vulnerabilities. Following these events, the hacker began the process of returning the stolen funds and by August 13, they had returned $340 million worth of crypto, with the remaining tokens transferred to multi-signature wallets jointly controlled by Poly Networks and the hacker.

By August 25, Poly Network was in possession of all $611 million of crypto and Offered a $500,000 reward to a hacker for finding this bug. They even went further and offered the hacker a position as head of cyber security, but we could not confirm if the hacker took them up on the offer.

Mount Gox – $473 million

One of the oldest large-scale crypto hacks occurred back in 2011 when one of the largest crypto exchanges at the time, Mount Gox, lost around 25,000 Bitcoins. At the time, it was worth around $400,000. But Mount Gox didn’t learn from his mistakes and 3 years later, hackers made another raid on Mount Gox’s wallet. They took out an additional 650,000 bitcoins from customers and 100,000 bitcoins from the company itself, which at the time was worth about $473 million.

As we mentioned, the first blow to Mount Gox was in 2011. During this time, hackers managed to break into Mount Gox’s systems and changed the price of one bitcoin to 1 cent and then proceeded to purchase many tokens themselves, with some customers also taking advantage of this temporary price manipulation.

Since then, Mount Gox has stated that they have tightened security, but it became clear that they failed to do so properly when another breach occurred in 2014. After investigation, it turned out that hackers had decrypted several private keys of Mount Gox in 2011, which were then used to steal additional funds.

When we say the hack happened in 2014, we mean it was discovered in 2014, while hackers had been extracting Bitcoin from Mount Gox wallets for the previous 3 years. The reason why this went unnoticed, especially considering that in 2013 Mount Gox was already drained of almost all Bitcoin, is unknown.

Several former employees state that the company was poorly managed and this contributed to the theft going unnoticed for many years. It is said that Mount Gox was able to retrieve around 200,000 Bitcoins shortly after this hack was noticed, but customers have yet to see their crypto back after 8 years.