Cryptocurrency theft is on the rise and more Bitcoin hacks are expected
Cryptocurrency theft from exchanges soared in the first half of 2018, to almost three times the level we saw in the entirety of 2017, according to a report.
Cybersecurity firm CipherTrace says that a total of $266 million worth of digital tokens were stolen from cryptocurrency exchanges last year. During the first six months of 2018, however, $761 million has been stolen from exchanges.
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“Stolen cryptocurrencies are three times bigger this year than last year so the trend is obviously not our friend here,” Dave Jevans, the CEO of CipherTrace, told Reuters.
Two high-profile hacks last month saw the price of Bitcoin, the best-known and most valuable cryptocurrency, plummet to below $5900 − its lowest level since October 2017.
Coinrail, a South Korean cryptocurrency exchange, was targeted by cybercriminals in mid-June, and Bithumb, another South Korean cryptocurrency exchange, was raided around a week later. Around $70 million worth of tokens were reportedly stolen as a result of those hacks, which may have been enough to panic Bitcoin holders into selling up, leading to its value to fall.
The cryptocurrency has since rallied, and is worth more than $6300 at the time of publication.
However, there’s likely to be plenty more trouble ahead. Earlier this week, Israeli cryptocurrency exchange Bancor lost $13.5 million to hackers.
CipherTrace believes a total of $1.5 billion worth of cryptocurrencies could be stolen from exchanges this year.
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“Threat actors use various methods to get their hands on [cryptocurrencies], such as stealing from individual users, hacking payment gateways or compromising whole financial exchange businesses,” said David Emm, principal security researcher at Kaspersky Lab UK.
“The acceleration that we are seeing virtual tender being stolen at is extremely alarming, and shows that cryptocurrency theft is becoming bigger and bigger business with each passing day. For losses to be reaching more than a billion pounds shows the true extent of this crime.
“There have been several devastating hacks on cryptocurrency exchanges in the past, and this report suggests there are many more to come.”
The security firm says you should avoid keeping lots of digital currency in online banks or exchanges, and instead recommends using an offline wallet (cold storage) service instead.
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