30s Summary

In 2024, crypto thefts, scams, and hacks surged by around 21%. A total of $2.2 billion was stolen, with centralized services and individuals’ private keys being the prime targets. The centralized finance sector was hit hard, with a 1,000% increase in incidents compared to 2023. Among the biggest heists were centralized exchanges, including Indian WazirX, Japanese DMM, and South Korean PlayDapp. Improved cybersecurity measures are required, with experts warning of increased use of AI in automated attacks and quantum computing threats. Measures like multi-factor authentication, cold storage, and self-custody are encouraged. Quantum-safe protocols are also crucial, especially with recent advancements in quantum computing technology.

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Bad news, folks. We saw a rise in crypto thefts, scams, and hacks in 2024. Compared to the previous year, these unfortunate incidents spiked by around 21%. The bad guys seemed particularly keen on going after centralized services and individuals’ private keys. Cybersecurity companies are warning that the continuous advancements in artificial intelligence and emerging quantum vulnerabilities could potentially make things worse.

Data from a blog posted by Chainalsysis on Dec. 19 shows that $2.2 billion were stolen last year – a significant jump from 282 incidents in 2023 to 303 last year. Interestingly, it seems the thieves were especially busy in the first seven months, with the stolen sum during that period ($1.58 billion) already accounting for 72% of the total amount pilfered throughout 2024.

Sadly, the centralized finance sector was hit hard, facing a staggering 1,000% increase in incidents compared to the previous year. Despite crypto increasingly catching the attention of institutional investors and traditional financial firms, many are still seeing it as a dicey gamble.

Some of the biggest heists in 2024 targeted centralized exchanges, like the Indian WazirX exchange hack in July, where the bad guys got away with $235 million. Then there was the Japanese exchange DMM, which lost a whopping $305 million in Bitcoin in May due to a private key hack. Not to mention the South Korean PlayDapp’s private key leak in February that led to losses around $290 million.

As per Chainalysis, almost half (43.8%) of the stolen crypto in 2024 was due to private key compromises. They highlighted the DMM Bitcoin hack that accounted for $305 million, as an example of what could happen when there’s poor private key management or lack of adequate security.

Besides these major heists, hundreds of other smaller hacks and scams took place last year, from pig butchering to fake airdrops to SIM swap attacks. Cybercriminals were getting creative and using anything from artificial intelligence to social engineering and phishing tactics to target individuals and their crypto wallets.

However, as cybersecurity measures continue evolving, so do the techniques used by cyber thieves. Cybersecurity guru, Jean Rausis warns about the rising criminal usage of artificial intelligence for automated attacks and fresh phishing schemes. His outlook for the future isn’t exactly bright either, as he foresees more sophisticated high-profile attacks in the years to come.

The threats aren’t going away, and it’s becoming paramount for both traditional centralized finance platforms and decentralized finance protocols to step up their defense game. And as our pal Phil Larratt over at Chainalysis says – the crime epidemic in the crypto industry is set to be one of the biggest challenges next year.

So, what’s the silver lining in all of this? Well, we can learn a lot from this whole debacle. It’s super essential to have multifactor authentication for protecting your crypto assets. And you must be on your toes constantly, keeping a lookout for any unsolicited communications and potential phishing attempts.

As an added measure of security, consider cold storage and self-custody. But remember, hardware wallets may also invite phishing attacks. Be ready for the fact that next year will bring new set of threats, such as AI-powered phishing, deepfake scams, and malware capable of bypassing detection. This also includes supply chain attacks, exploitation of the Internet of Things (IoT) and cloud APIs, and potentially quantum computing threats.

And while quantum computing is just dawning, it does pose a long-term threat to existing encryption standards. We need to proactively move towards quantum-safe protocols. On a side note, Google recently revealed a new quantum computing chip, called Willow, that can process calculations at an amazing speed while significantly reducing errors.