Hackers Target Centralized Exchanges: $1.4 Billion Worth in Crypto Exploits in 2024

Here are some of the major developments in the world of crypto over the past few days.
Major crypto updates around the world
Major crypto updates around the world

A recent study by the cybersecurity firm Cyvers estimates that the alarming rise of cryptocurrency thefts amounts to  $1.4 billion this 2024. Centralized exchanges are now the bullseye of hackers. Crypto losses alone topped $600 million in Q2 2024, more than double the total loss in Q2 2023.

This is due to two factors: the concentrated assets on single platforms, and potential security vulnerabilities in some cryptocurrency exchanges. On the other hand, access control breaches—often through phishing attacks—have led to approximately $490 million in funds stolen, considerably larger than smart-contract exploits reaching less than $70 million thus far.

Also Read: Indian Crypto Exchange CoinDCX Expands in Middle East Through BitOasis Acquisition

While DeFi protocols have shown very basic resistance, cross-chain bridges are now an Achilles heel for the developers. As per the report, a few high-profile hacks—for instance, a $300 million breach of the Japanese DMM exchange—have strongly impacted Q2 data. This included another incident of theft of $50 million from Turkish exchange BtcTurk in June.

Though a chunk of that money lost has since been recovered, nearly 76% is yet to be. Cyvers warns that in Web3, next-generation threats will be opened by AI and Quantum technologies in the hands of users against which chain security measures struggle to defend.

Ethereum Launches $2M 'Attackathon' to Bolster Blockchain Security

The Ethereum community is to hold the first hackathon, tagged "Attackathon," ever hosted, with a $2 million reward pool for participants. It is the largest crowdsourced security audit on the codebase of the blockchain. According to a July 8 blog post by the Ethereum Protocol Security research team, in essence, "Attackathon" would mean that security researchers are actively on the lookout for vulnerabilities within the code of the protocol in this four-week, time-bound audit challenge.

Participants shall compete based on predefined rules for the contest, and only impactful, rule-compliant reports will be eligible for reward. The activity will be technically initiated with a walkthrough of the code of the blockchain to ensure better preparation of participants to identify and understand possible vulnerabilities.

Once the event is over, the bug bounty platform Immunefi will gather all the findings and draw up a report on the vulnerabilities identified. The EPS team has thrown $500,000 into the prize pool of the competition and is looking for sponsors to boost it by another $1.5 million before August 1, when more details are due to be released. The team plans similar hackathons to be held at every hard fork changing the codebase.

The next hard fork for Ethereum, "Pectra," will occur later this year or early 2025, bundling the upgrades previously known as "Prague" and "Electra." Some of its important updates include the feature of "social recovery," which could obviate the need for the traditional 24-word private wallet key by giving wallets smart contract-like features.

Read More: Crypto Market Gains Marginally Even As Trading Volume Rises; Bitcoin, Ethereum Up

Bitcoin ETFs Defy Crypto Slump with Biggest Inflows in Over a Month

BlackRock's iShares Bitcoin Trust ETF set the tone with the biggest daily inflow of $187.2 million. Wise Origin Bitcoin Fund from Fidelity also scored big with a gain of $61.5 million. Even the embattled Grayscale Bitcoin Trust had a positive day with inflows of $25.1 million.

That investment surge comes amid wide market concerns, such as the German government offloading heavyweight Bitcoins and the probable effect of Mt. Gox creditor repayments. Although some analysts believe the Mt. Gox situation is unlikely to have much impact and is serving to allow sophisticated investors to buy low.

Over the past two trading weeks, the price of the asset plunged as low as $53,600, meaning it briefly slid below $54,000 for the first time since February. Very strong inflows to Bitcoin ETFs show long-term prospects for the leading cryptocurrency remain intact this very couple of days, as its price went below the $54,000 level for the first time since February.

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