According to Chainalysis, 2022 will be a record year for cryptocurrency heists.
A blockchain analytics firm has hinted at the numbers ahead of its upcoming annual cryptocrime report.
A total of $3.8 billion was stolen from cryptocurrency companies last year, 82% of which targeted weaknesses in DeFi protocols. This is up from 73% the year before.
North Korean hackers stole $1.7 billion, most of it ($1.1 billion) from DeFi, notably the Ronin Network attack in March, which was calculated to have cost $618 million at the time It has been.
Chainalysis said that cross-chain bridge protocols of the kind targeted in its attacks accounted for the majority (64%) of DeFi protocol attacks.
“Cross-chain bridges typically allow users to transfer cryptocurrencies from one blockchain to another by locking the user’s assets into a smart contract on the original chain and creating an equivalent asset on the second chain. It’s a protocol that makes it portable.”
“Bridges are an attractive target for hackers, as smart contracts effectively become giant centralized repositories of funds backing assets bridged onto new chains. Few could have imagined a more desirable honeypot.” If the bridge grows large enough, it is almost certain that errors and other potential weaknesses in its underlying smart contract code will eventually be discovered and exploited by bad actors.”
DeFi’s smart contract code is public by default, which not only increases transparency but also allows attackers to scan for vulnerabilities, Chainalysis warns.
Code audits conducted by third-party providers and developers’ dedication to security over growth can help reduce risk, the report argues.
Chainalysis also claimed that North Korean hackers sent large amounts of stolen cryptocurrency to a “mixer,” mixing multiple users’ digital currencies together to obfuscate their provenance.
They are actually A money laundering tool caught the attention of regulators. But once North Korea’s popular mixer (Tornado Cash) was licensed by the US in August 2022, the attackers simply moved on to another mixer. Sinbad.
