In 2019, there were five major cryptocurrency exchange hacking incidents. Eleven of these hacks resulted in the theft of cryptocurrencies, including one involving only stolen customer data. In 2019, a total of $ 292,665,886 worth of cryptocurrency and 510,000 user logins were stolen. 2019 experienced more cryptocurrency hacks than in 2018.
Over time, you may think that cryptocurrency transactions will become more secure. However, in reality, more cryptocurrency hacks are taking place year after year. Cryptocurrency transactions remain unregulated, making it difficult to establish which regulatory agency has jurisdiction over the crypto markets.
There are no established rules regarding how cryptocurrency exchanges should safeguard customer funds. Canada, Malta, and Wyoming have established crypto-friendly laws that make businesses more comfortable to operate and provide guidelines on security practices.
Unfortunately, not all countries have guidelines or laws in place to help run cryptocurrency businesses and reduce consumer risk. The way cryptocurrency exchanges store and protect their wealth varies from one platform to another. Unfortunately, this makes cryptocurrency exchange a breeding ground for hackers, leading to the theft of cryptocurrency or customer data. Take a closer look at the number of cryptocurrency exchange hackers in 2019 and the amount of stolen cryptocurrency, fiat money, and customer data in each incident.
Due Events and Specific Platform
Amount stolen; $2700 (Headquarter Finland)
LocalBitcoins detected a security vulnerability that allowed “illegal sources” to access and send transactions from numerous affected accounts. Six violations were identified. The company identified the source of the problem as “the capabilities of third-party software.”
The hackers were able to replace the official link to the exchange forum with a fraudulent link, directing the user to a fake page that looked like a forum but gathered information about the user trying to connect. The attacker used this information to steal 7.9 Bitcoins (then valued at $ 27,000) from at least six user accounts.
The amount stolen $32 million ( headquarters Japan)
On July 11, Japan-based cryptocurrency exchange BITPoint was warned of XRP’s improper withdrawal from the hot wallet. A few hours later, BITPoint realized that unauthorized removal of Bitcoin, XRP, Ethereum, Bitcoin Cash, and Litcoin from the active stock market. A total of $ 32 million in cryptocurrencies left BITPoint’s hot wallet. $ 23 million for BITPoint users.
(Amount stolen $7.09 million, HQ Singapore)
On March 24, Singapore-based DragonEx reported to the official telegraph organization that it had been hacked. As a result, certain crypto assets of users and platforms were stolen. A few days later, DragonEx posted on its website: “On March 24, DragonEx was attacked by APT. This is the biggest challenge since DragonEx launched in 2017”.
(Amount stolen $105 million)
Two days after the DragonEx hack, another CoinBene cryptocurrency exchange in Singapore was hacked. When the CoinBene website unexpectedly ended maintenance, many CoinBene users were suspected of being hacked. Individuals following the popular CoinBene wallet noticed that $ 105 million in crypto assets had been deleted. All evidence is on the blockchain, but CoinBene continues to deny hacking.
(Amount stolen $40 million, HQ Malta)
On May 7, Binance, the world’s largest cryptocurrency exchange, suffered a security breach. As a result, 7,000 BTC were stolen, valued at $ 40 million at the time. Besides, Binance said that hackers obtained user API keys, two-factor authentication codes, and in some cases, more user information.
Later on August 7, it became clear that the hacker had obtained more than 60,000 Know Your Customer data from the Binance exchange. An individual named “Bnatov Plato” hacked individuals who had hacked Binance in May. The original hackers also had access to 60,000 KYC customer data, including the identity photos of 10,000 KYC customers, Binance.
A total of $139000000 was stolen from 5 cryptocurrency exchanges, and 510,000 user information was retrieved from an exchange database. A total of 12 cryptocurrency exchanges were attacked in 2019.
What does that mean? This means that cryptocurrency exchanges need to do better in terms of industry standards and security practices. Unfortunately, legislation and security didn’t improve enough in 2019, and the number of hackers for cryptocurrency exchanges has increased from last year. But I hope this will change in 2020, and I hope that the cryptocurrency market will be more secure for all parties involved in the cryptocurrency ecosystem.