Crypto Exchanges Can Get Hacked: So Watch Out!

While investors are lucky to get rich from their cryptocurrency investments, so are the hackers that have infiltrated crypto exchanges in 2021. Cyberthieves have made a lot of money from stolen virtual assets and it appears to be a huge problem that has yet to be solved.

There have been over 20 hacks this year where digital hackers stole at least $10 million in cryptocurrencies from notable exchanges and projects. In at least 6 of these 20 instances, hackers stole more than a whopping $100 million in crypto tokens, according to a stat sheet conceived by NBC News.

In comparison, actual bank robbers only netted to an average of just shy of $5,000 last year in the latest FBI’s annual crime statistics. This is at least 20 times less than what crypto hackers have made from their heists, and it is beginning to scare investors away from the hot-streaking crypto market.

When investing in anything, especially with cryptocurrencies, safety should be the number one priority. With the rise of Bitcoin gambling, investors should feel safe storing and trading their crypto tokens online.

The modern-day bank robbers

Opportunists are always there to either make something good with their skills or entirely terrible. With crypto hackers, they only make the lives of hardworking investors much harder which puts the market in a bad light.

While this year only experienced around 20 incidents of theft, the volume of crypto tokens stolen was so large that there might as well have been thousands of theft cases, and the outcome won’t be any different.

As the rise of cryptocurrencies has paved the way for a more streamlined approach to trading and other means of transactions through exchange platforms, it also generated a lot of opportunities for modern-day robbers to take advantage of this streamlined service.

Spurring more than 300 establishments globally, cryptocurrencies have made so many new business opportunities like crypto trading platforms and institutions that only accept crypto tokens that make an entire market.

Furthermore, the inception of Bitcoin (BTC) has also paved the way for more altcoins (every cryptocurrency except bitcoin) that diversify the investment opportunities for new and seasoned investors. With so many tokens in the market, exchanges are bound to exist to make transactions like trading and buying different products and services much simpler. 

How safe are crypto wallets exactly?

Cryptocurrency wallets are digital and are usually either ‘hot’ or ‘cold’. Hot wallets are more flexible in that they can be used to trade and exchange for different digital goods through the internet. Meanwhile, cold wallets are entirely offline to avoid cybercrimes from happening. Cold wallets are best used to store larger amounts of cryptocurrencies.

With hot wallets, hackers can find ways to steal them through sophisticated methods that allow them to take all the hard-earned investments from other people. In most cases, this breach happens through private keys where hot wallets operate to make the software safe from attacks.

However, hackers have found ways to acquire this private key and open hot wallets then transfer all the valuable data that store plenty of crypto tokens onto their own accounts.

Dave Jevans, founder of CipherTrace– a company that helps track theft and fraudulent activities surrounding the crypto market– have these few words to say about private keys and hackers trying to steal them: “If you steal the private keys to a hot wallet, it’s not like stealing a database of people’s names and Social Security Numbers. You’ve just basically stolen all their money.”

As cryptocurrencies keep on gaining traction with new endeavours getting introduced like Bitcoin gambling and trading, creators and software developers should find more ways to incorporate a safer technology to alleviate the issues of hacking and cyber theft.