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More than $3 billion in crypto hacks in 2022 – mostly in DeFi

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more-than-$3-billion-in-crypto-hacks-in-2022-–-mostly-in-defi
More than $3 billion in crypto hacks in 2022 - mostly in DeFi

Crypto suffered its worst ever year for hacks in 2022. Most of these hacks were on DeFi platforms which saw a third of all such activity in the last year.

While certain crypto and DeFi platforms have contributed the most disruptive technology to finance and other industrial sectors, platforms have been exploited due to the nascent state of the code that they have deployed.

Many would argue that crypto is basically a testing ground for what might prove to be the most innovative technology, the scale of which could compare with the internet and the dotcom era that began on top of it.

However, 2022 has been a particularly tough year for this technology, and fraudulent activity and hacks have abounded. According to an article on Forbes, more than $3 billion in value was misappropriated. The following are 8 of the biggest hacks:

  • Ronin Network: $625 million – Hackers stole over $625 million worth of ether and USD coin from the Ronin Network, a blockchain for the Axie Infinity video game. The U.S. Treasury Department later linked the heist to North Korean state-backed hacking group Lazarus Group.
  • Wormhole Network: $325 million – On February 2, an unknown hacker exploited a vulnerability in the Wormhole Network, a protocol that allows users to move cryptocurrencies and NFTs between different blockchains. The attacker created 120,000 wETH (worth around $325 million) without putting up the necessary collateral. Jump Crypto, the parent company of Wormhole, later replaced the stolen funds.
  • Nomad: $190 million – A hacker exploited a weakness in Nomad’s code to steal approximately $190 million in tokens on August 1. Dozens of copycats joined the heist. Nomad was able to recover over $20 million after pleading with users to return the funds.
  • Beanstalk Farms: $182 million – In April, an attacker drained over $150 million in crypto from Beanstalk Farms, a stablecoin project based on Ethereum. The hacker used a flash loan from the Aave protocol to borrow nearly $1 billion in crypto and gain a 67% voting stake in Beanstalk. With this supermajority, the hacker was able to transfer the Beanstalk tokens to their own wallet.
  • Wintermute: $160 million – The London-based crypto market maker lost $160 million in a September 20 hack. It is believed that hackers used brute-force computing to generate all the possible passwords to a company vanity address.
  • Mango Markets: $112 million –  Avraham Eisenberg held $112 million worth of tokens in ransom to force Mango Markets, a decentralised crypto exchange, to finance bad debt. Eisenberg used two accounts on the platform to take large positions in perpetual futures on the dollar-pegged USD coin, causing its price to spike tenfold on other decentralised exchanges. He then used the profit to borrow and withdraw a number of tokens from Mango.
  • BNB Smart Chain XCN2: $110 million – Hackers stole an estimated $110 million from the Binance-affiliated BSC Token Hub on October 6. Binance blamed the hack on a “flash loan exploit” and later recovered the stolen funds.
  • Harmony Horizon Bridge: $100 million – There were concerns about the bridge even before it was hacked for $100 million in various cryptocurrencies in June of 2022, given that the small number of validators for its multi-sig wallet left it vulnerable to attack.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Piere Stevenson

Total convert to crypto and blockchain. As a content writer I research and write about various projects in the cryptoverse.

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