Blockchain Hackers Cost Crypto Ecosystems More Than $1B in Q1 2022

Blockchain hackers stole nearly $1.3 billion in 78 hack events throughout Q1 2022, according to a new report by Atlas VPN. 

Based on data provided by Slowmist Hacked, Atlas VPN found that hacks on Ethereum and Solana’s ecosystems resulted in more than $1 billion in losses alone during Q1.

The Ethereum ecosystem lost nearly $636 million to attackers in 18 hack events throughout Q1 2022—the largest of which cost the platform 173,600 Ethereum and 25.5 million USDC worth $610 million. 

The Solana ecosystem, a rival to Ethereum, suffered five hack attacks in 2022 Q1 at cost of $397 million. Wormhole, a communication bridge between Solana and other decentralized finance (DeFi) networks, was the second most significant hack of the quarter, resulting in a loss of $334 million. 

The $1 billion cybercrime haul also includes 14 hacks of the Binance Smart Chain ecosystem at a loss of nearly $100 million and  IRA Financial Trust, which handles self-directed retirement accounts, loss of $36 million to a crypto hack.

Cybercriminals top target were NFTs, which suffered $49 million in losses after 20 hacks, while exchanges lost $42 million over the course of three hacks. 

Also read: DeFi: Should Wall Street Be Worried?

The Growing Threat to Blockchain Ecosystems

In Q1 2018, cryptocurrency projects experienced a total of five blockchain-related hacks, according to Atlas VPN. The following year that number increased to 62m but dipped by 13 in Q1 2020. Q1 2021, hackers efforts jumped to 33, an increase of 154 percent—reaching an all time high of 78 hack events in Q1 2022. 

The rise of DeFi has opened a new, lucrative door for cybercriminals as more than 300 cryptocurrency companies have entered the market. Blockchain is generally thought of as secure, but this groundswell has introduced smaller exchanges that might not have the cybersecurity staff necessary to secure their new ecosystems. Often, the open availability of these platforms’ code gives hackers ample opportunity to plot attacks, as was the case in the Wormhole hack—the second largest such hack behind the Poly Network hack, which cost that cryptocurrency platform more than $600 million (the hacker later returned all of the funds). 

“Blockchain project security should be one of the primary concerns for a person looking to invest in cryptocurrency,” said Atlas VPN’s cybersecurity writer Vilius Kardelis. “Most blockchain-related hack events happen because cybercriminals exploit flaws in the project code. A successful hack could cause significant losses to the creators and investors of the crypto platform.”

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