Hackers are becoming an increasing risk, employing sophisticated tools in order to gain access to exchanges and wallets.
They’re based around the world, with particular concentrations in East Asia and Eastern Europe, and are fast to respond to changes in security, booms in various markets, and anything else that defines how easy it is for them to target cryptocurrency.
We’re going to look at a few aspects of cryptocurrency theft in 2020, and the methods crypto hack thieves currently use in their work.
Online Gaming: An Early Adopter of Cryptocurrency
Online gaming sites were actually one of the first industries to really embrace the concept of cryptocurrency. Whether offering sports betting, casino games, or slots based on films such as Batman, these sites process a huge amount of money every single day.
As a result, their users are definitely a potential target for crypto hack theft. Crypto hack thieves are able to easily exploit any vulnerabilities in the payment processes that are used by online gamers when they transfer a cryptocurrency in order to deposit on their games.
Who Is Responsible for Crypto Hack Crime?
People who carry out crypto hack attacks are criminals who make use of weaknesses in online cryptocurrency storage and transactions to steal bitcoin and other currencies.
They’re a new form of a hacker, benefiting from the current boom in cryptocurrencies by illegally accessing other people’s wallets and stealing the money contained within. It may sound like a niche industry, but it’s possible to steal billions of dollars every year through a variety of different crypto hack methods.
Where Are Most Crypto Hack Attacks Coming from in 2020?
Despite being early adopters of online technology and cryptocurrencies, Western countries tend to possess fewer people who take part in crypto hack attacks than other parts of the world.
Part of this is down to the fact that far better internet speeds can be found in other parts of the world, and the potential gains from a crypto hack go a much further way in lower-income countries.
Why Is De-Fi Attracting Crypto Hack Attacks in 2020?
So far, one of the main targets of crypto hackers in 2020 has been the world of decentralized finance or Defi. Defi refers to the use of blockchain technology to create an entire online economy, completely decentralized and with no reliance on identity or location, regulated solely by algorithms, and entirely anonymous.
All code is also open source. Unsurprisingly, the anonymity of this world and the availability of the code means that it has been a major target for crypto hack attacks in 2020.
Why Is Defi the Target for 2020?
Hackers are also responding to a wider awareness from exchanges and funds, which were the previous targets of the majority of crypto hack activity.
Once people answered the question ‘How do hackers hack crypto exchanges’, the industry quickly adapted, cutting off sources of bitcoin for hackers.
While mass-scale theft from exchanges was a major target of crypto hacker crime in recent years, as the exchanges boosted their security, crypto hack operations have moved on to a new target. De-Fi is the current favorite.
Defi tripled in worth over the course of a few months, going from $4 billion in August 2020 to $12.6 billion in November. This massive boom has formed the ideal alternative target for crypto hack operations.
What Is the Biggest Crypto Hack of 2020?
The biggest De-Fi crypto hack of the year so far has been on the Chinese platform dForce, which lost around $25 million via its lending application, LendF.me. Crypto hack criminals made use of a reentrancy vulnerability to increase their ability to borrow from the platform, ultimately allowing them to leave with the entirety of assets available on the platform.
Given that an error in one protocol can point to vulnerability in any other systems using the same protocol. dForce has scrambled to ensure that other systems are not at risk.
Crypto Hackers Play Robin Hood with Charity Donations
One of the more interesting crypto hack stories of 2020 came with the revelation that hackers had donated a considerable amount of stolen currency to two major global charities.
The crypto hackers had used Ransomeware crypto hack attacks to accumulate the funds, then use the organization The Giving Block, a crypto-based charity mediator, to give the money to Children International and The Water Project.
Commentators see this as a potential statement from crypto hackers, and condemnation of wealth inequality in 2020. However, The Giving Block has reported that it is prepared to return the stolen funds, making this less of a win for crypto hack philanthropists than a well-intentioned failure.
2020 marks a major departure in the world of bitcoin and hackers. The world of cryptocurrency is constantly evolving, and people looking to make money from hacks need to evolve. Following major exchange thefts in recent years, it’s no surprise that decentralized finance forms their biggest target at the moment.
While overall losses are still down compared to last year, the fact remains that crypto hackers have adapted to the increased security placed on exchanges, and found a new source of funds. It remains to be seen what their next target is, after the likely improvement of de-fi security.