Overview

The rise of cryptocurrency has brought wealth and innovation, but it has also introduced significant security risks. Hacking attacks remain a persistent problem in the crypto industry, with billions of dollars stolen over the past decade. Below is a list of the 10 most impactful crypto hacks in history, each of which has left a lasting impact on the industry.

For instance, in 2024, crypto platforms suffered $2.2 billion in losses due to hacking, marking a 21.07% increase from the previous year. Notably, hacking activity spiked between January and July 2024, with North Korean cybercriminals stealing over $1.34 billion, accounting for 61% of the total losses.

Source: https://www.chainalysis.com/blog/crypto-hacking-stolen-funds-2025/

Top 10 Crypto Hacks

The global cryptocurrency sector has experienced multiple major hacking incidents, with the largest loss occurring in February 2025—the Bybit hack, where $1.46 billion was stolen. Hackers used sophisticated phishing attacks and smart contract vulnerabilities to extract ETH from cold wallets. The second-largest hack was the Ronin Network attack in March 2022, in which hackers gained control of Axie Infinity’s sidechain validator nodes and stole $625 million in ETH and USDC.

Other major attacks include:

• Poly Network cross-chain bridge exploit (2021) – $611 million stolen
• Binance BNB Bridge hack (2022) – $569 million stolen
• Coincheck exchange hack (2018) – $534 million stolen
• Mt. Gox exchange collapse (2014) – $473 million stolen

Additionally, platforms such as FTX, Wormhole, DMM Bitcoin, and KuCoin have also suffered significant hacks. While some losses were recovered through insurance and compensation measures, these events highlight the severe security risks within the cryptocurrency industry.

Source: https://cointelegraph.com/news/kucoin-ceo-says-insurance-covered-16-of-losses-from-285m-hack-in-2020

Impact and Future Outlook

Overall Trends and Key Security Issues in the Industry

(1) Cross-Chain Bridges as High-Risk Targets

Cross-chain bridges have become a primary target for hackers due to their complexity and the high volume of asset transfers. The need to coordinate operations across multiple chains increases the likelihood of vulnerabilities.

Source: https://www.reuters.com/technology/how-hackers-stole-613-million-crypto-tokens-poly-network-2021-08-12/

Major Incidents:

• Poly Network (2021): $613 million stolen, exposing the risks in cross-chain smart contracts.
• Binance BNB Bridge (2022): $570 million stolen, as hackers exploited a validation vulnerability.
• Wormhole (2022): $326 million stolen, due to a flaw in the smart contract verification mechanism.

Industry Impact:

• Strengthened cross-chain bridge security design, incorporating multi-signature and Multi-Party Computation (MPC) technologies.
• Shift towards Rollups and native interoperability solutions (e.g., LayerZero) as alternatives to traditional cross-chain bridges.

Source: https://www.halborn.com/blog/post/explained-the-wormhole-hack-february-2022

(2) Cold/Hot Wallet Management Weaknesses

Even cold wallets are not completely secure. Hackers use phishing attacks, social engineering, or internal access vulnerabilities to bypass defenses. Hot wallets, always connected to the internet, remain high-risk targets.

Major Incidents:

• Bybit (2025) (Expected): Exchange hacked due to wallet mismanagement, potential losses unknown.
• Coincheck (2018): $534 million in NEM stolen, as the hot wallet lacked multi-signature protection.
• KuCoin (2020): $280 million stolen, as hackers gained access to private keys and took control of hot wallets.

Industry Impact:

• Exchanges are increasing cold wallet usage, enforcing multi-signature authentication and Hardware Security Modules (HSMs).
• Adoption of “Proof of Reserves” transparency mechanisms, reducing concerns over centralized storage risks.

Source: https://www.ic3.gov/PSA/2025/PSA250226

(3) Weaknesses in Sidechains and Emerging Technologies

The Ronin Network attack (2022) exposed the vulnerabilities in sidechains and newer blockchain technologies, particularly in validator security. Many blockchain games and sidechains operate with a low degree of decentralization, making them easier for hackers to compromise.

Major Incident:

• Ronin Network (2022): Hackers gained control of 5 out of 9 validator nodes, stealing $620 million.

Industry Impact:

• Projects are enhancing validator decentralization, increasing the number of nodes and improving consensus security.
• GameFi and NFT-focused sidechains are transitioning to Layer 2 solutions like Arbitrum and Optimism for enhanced security.

Source: https://www.technologyreview.com/2022/04/15/1050259/a-620-million-hack-just-another-day-in-crypto/

(4) Systemic Risks in Centralized Exchanges (CEXs)

Centralized exchanges (CEXs) are vulnerable by design, as their centralized structure exposes them to management failures, insider fraud, and external hacking threats.

Major Incidents:

• Mt. Gox (2014): 850,000 BTC stolen (~$4.7B in today’s value), shaking the market.
• FTX (2022): $8 billion in customer funds misused due to fraudulent mismanagement.
• DMM Bitcoin (2024): Large-scale hack exposed weaknesses in exchange security protocols.

Industry Impact:

• CEXs face stricter regulations, requiring proof of reserves and asset segregation policies.
• More users are switching to decentralized exchanges (DEXs), increasing demand for self-custodial wallets.

Source: https://www.cnbc.com/2022/12/18/how-sam-bankman-fried-ran-8-billion-fraud-government-prosecutors.html

These incidents have collectively pushed the industry to place greater emphasis on security issues. From a technical perspective, the industry has increased investment in wallet management, smart contract auditing, and cross-chain bridge security design; From a management perspective, centralized platforms have been forced to strengthen internal access controls and employee training. However, security challenges remain a fundamental bottleneck for industry development, especially in the fast-paced evolution of new technologies.

Regulatory Trends and the Acceleration of Compliance

High-profile hacking incidents have directly increased regulatory scrutiny, especially following major financial losses and widespread impact (e.g., Mt. Gox, FTX). As a result, global regulatory trends have evolved in the following ways:

From Regulatory Gaps to Structured Oversight

When the Mt. Gox hack (2014) occurred, there were virtually no regulations in the crypto industry, making it difficult for investors to recover their losses. By the 2020s, key jurisdictions such as Japan (after the Coincheck hack), the EU (via the MiCA framework), and the U.S. (SEC crackdowns post-FTX collapse) began implementing stricter regulations. These regulations require KYC/AML compliance, asset segregation, and regular audits for crypto exchanges.

Source: https://www.fsa.go.jp/en/news/2022/20221207/01.pdf

Regulating Cross-Chain Bridges & DeFi

Hacks like Poly Network and Wormhole exposed regulatory blind spots in decentralized finance (DeFi). In the future, regulators may attempt to monitor DeFi through on-chain tracking technologies or require protocol developers to disclose their identities—while also ensuring that innovation is not stifled.

Stricter Cold/Hot Wallet Management Standards

Hacks on Bybit (2025) and KuCoin (2020) have pushed regulators to focus on exchange wallet security. Future regulations may include mandatory cold storage requirements or periodic public proof-of-reserves disclosures for exchanges.

Impact:

Stronger regulations may increase short-term compliance costs, particularly for smaller exchanges. However, these measures will help standardize the industry and reduce systemic risks in the long run. Japan’s post-Coincheck regulations led to widespread cold storage adoption, while FTX’s collapse accelerated global demands for exchange transparency.

Path to Rebuilding Industry Trust

Crypto hacks have significantly damaged investor trust, particularly after massive user losses from events like Mt. Gox and FTX. Rebuilding confidence requires improvements in both technology and institutional safeguards:

Enhancing Technical Transparency

Incidents like KuCoin (2020) and Wormhole (2022) showed that blockchain transparency can aid in crisis management, as some stolen funds were recovered through on-chain tracking and protocol fixes. In the future, Proof of Reserves (PoR) may become an industry standard, requiring centralized platforms to disclose asset reserves to boost user confidence regularly.

Source: gate.io

Compensation and Insurance Mechanisms

Coincheck (2018) and DMM Bitcoin (2024) compensated users through company funds or insurance, easing some trust issues. This suggests that an industry-wide insurance fund or mandatory compensation mechanisms could emerge in the future. Similar to traditional finance, a deposit insurance model might gradually be introduced into crypto markets.

Source: relminsurance.com

Growing Decentralization Trends

Following the Ronin Network attack (2022), the industry began re-evaluating the necessity of decentralized validation mechanisms. With the rise of decentralized exchanges (DEXs) and self-custody wallets, users may reduce dependence on centralized platforms, mitigating risks.

Trust rebuilding is a long-term process. In the short term, investors may lean toward major exchanges or fully decentralized solutions. In the long run, if the industry can reduce the frequency of hacking incidents through technological innovation and self-regulation, the trust crisis may gradually ease.

Notorious Crypto Hacking Groups

Hacking attacks in the cryptocurrency space often involve sophisticated cybercriminal organizations that exploit technical vulnerabilities, social engineering, and other tactics to steal funds.

Below is a summary of some notorious hacking groups in the crypto industry, based on public reports and historical incidents. It is important to note that the exact identities and affiliations of these groups are often difficult to confirm, and some attributions may be based on speculation.

Different hacker groups impact the crypto industry in different ways. Some, like Lazarus Group, focus on direct crypto theft, while others, like DarkSide and REvil, primarily use ransomware attacks that demand cryptocurrency payments. Their identities and affiliations are often based on public reports, law enforcement statements, or cybersecurity analyses, meaning that some claims remain controversial.

Understanding that crypto hacking groups operate in deep secrecy is crucial, making attribution challenging and sometimes politically influenced. Additionally, as technology advances, new hacker groups will likely emerge, meaning crypto security will remain a constant battle.

Source: channelfutures.com

Cyber Attacks and Defense Measures

Hackers can launch attacks through various methods, including phishing, malware, ransomware, denial-of-service (DoS), SQL injection, smart contract vulnerabilities, and 51% attacks. Each of these poses risks of financial loss or system failure.

However, defense measures such as two-factor authentication (2FA), antivirus software, wallet backups, encrypted networks, and regular security audits can help mitigate these risks.

Source: cointelegraph.com

Money Laundering Methods and Prevention Measures

Money laundering techniques include coin mixers, cross-chain bridges, decentralized exchanges (DEX), over-the-counter (OTC) trading, bulk transactions, and exchange splitting.

Prevention measures include using multiple wallet addresses, regularly reviewing transaction history, checking cross-chain bridge security, selecting reputable DEX platforms, verifying OTC trading counterparties, monitoring unusual bulk transactions, and strengthening inter-exchange fund flow regulations. These steps help identify and prevent money laundering activities.

Source: home.treasury.gov

Comparison Between Crypto Hackers and Traditional Hackers

Crypto hacking attacks and traditional cyberattacks differ significantly in terms of techniques, targets, impact, and defense measures. Crypto hackers focus on exploiting blockchain and cryptocurrency vulnerabilities, while traditional hackers primarily target IT infrastructure and network security weaknesses.

As cryptocurrencies become more mainstream, enhancing security, strengthening regulations, and improving user awareness will be crucial in reducing these types of attacks.

Source: https://en.wikipedia.org/wiki/WannaCry_ransomware_attack

Investment Tips for Individual Investors

Diversify Investments to Reduce Risk

Hacker attacks demonstrate that security breaches in a single platform or project can result in significant losses. Distributing funds across multiple platforms and projects helps mitigate the impact of any single event on an investor’s portfolio, thereby reducing overall risk.

Choose Secure Platforms

Selecting platforms with strong security measures is crucial in minimizing risks. Prioritize exchanges that offer cold storage, two-factor authentication (2FA), and asset insurance to ensure fund safety.

Investors should check whether an exchange utilizes cold storage (keeping most assets offline), multi-signature wallets, insurance funds (such as the SAFU fund), and financial reserves for enhanced security.

For example, as of March 9, 2025, Gate.io holds financial reserves of $10.328 billion, demonstrating its strong commitment to securing user funds.

Source: gate.io

Understand and Use Risk Management Tools

Using exchange-provided insurance funds and asset tracking technologies can significantly enhance security. Choose platforms that can respond swiftly to hacker attacks and have asset recovery capabilities.

Additionally, enable two-factor authentication (2FA), regularly monitor account activity, and quickly identify suspicious transactions to prevent potential threats.

Source: play.google.com/store

Maintain a Long-Term Investment Perspective

Despite short-term market volatility, security measures and technology in the industry are constantly improving. Investing in projects that learn from past attacks and strengthen their security can yield more stable returns over time.

Beware of Phishing Attacks and Social Engineering

As technology advances, hackers’ attacks are becoming more sophisticated, particularly in social engineering tactics such as phishing scams. Investors should stay security-conscious, avoid clicking suspicious links, and never share personal information to prevent potential security risks.

Conduct Due Diligence and Avoid Blind Investments

Before investing, thoroughly research a project’s background, team, and security measures. Avoid blindly following market trends and focus on projects with strong technical foundations and proven security measures.

Stay Informed and Keep Up with Industry Trends

The crypto industry is fast-evolving, and investors must continuously update their knowledge of security protocols, market trends, and technological advancements. Keeping up with industry developments helps investors make better-informed decisions in a complex market.

Individual investors should enhance security awareness, carefully select platforms, and mitigate risks through diversification and risk management tools. By avoiding single-point failures and adopting a long-term perspective, investors can focus on projects capable of overcoming security challenges and continuously improving their defenses.

Conclusion

The rapid development of the cryptocurrency industry has brought tremendous innovation and wealth opportunities, but security remains one of its biggest challenges. Major hacking incidents over the years have resulted in billions of dollars in losses while also exposing security vulnerabilities in crypto exchanges, wallets, and cross-chain technologies. As hacking techniques become increasingly sophisticated, often involving organized cybercriminal groups, enhancing security measures and strengthening regulatory frameworks has become a key priority for the industry’s growth.

Despite these challenges, the industry is actively working to improve security through technological innovations and preventive mechanisms. Measures such as smart contract audits, decentralized security frameworks, and improved employee security training aim to reduce risks and enhance user trust.

Looking ahead, as technology matures and regulations improve, the cryptocurrency industry is expected to become safer and more stable, paving the way for broader adoption and societal acceptance. However, security risks remain a long-term challenge, and only through collective efforts from all industry participants can we effectively prevent hacking attacks, combat money laundering, and ensure the healthy development of the crypto market.