Cryptocurrency Market Hacking Lost $1.9 Billion in 2023, But Attacks Are Getting More Sophisticated

In 2023, the cryptocurrency market lost $1.9 billion to hacking, a 93.6 per cent drop from the previous year. While this may seem like a positive trend, further investigation by blockchain security auditing firm Hacken reveals that the frequency and sophistication of attacks are on the rise.Hacken's 2023 Security Report shows that total losses due to hacking and fraud fell to $1.9 billion. One of the largest thefts this year involved Multichain, which lost $231 million in bridging. That figure is well below the Terra Luna incident in 2022, when more than $40bn in value was wiped out, crippling the entire industry.Hacken describes 2023 as a period of improved security and better security practices. However, audit firms recorded a 14 per cent increase in the number of attacks compared to the previous year, with a significant increase in all types of hacking. The most damaging type of breach this year was access control, where hackers or insiders gained unauthorised access to hot wallets, resulting in half of the stolen funds and an average loss of $31 million per incident. This includes security breaches such as Multichain and Atomic Wallet. A close second was the Lightning Loan attack, which, despite having more incidents than access control, totalled just over $275 million in stolen funds. Meanwhile, Rug Pulls lost an average of $566,000 per incident, making it the second most damaging type of attack after the closely related honeypot scam.