Mitchell Amador warns of the 'trust collapse' crisis in crypto projects

Web3 Security Platform EumniPi’s CEO Mitchell Amador recently raised concerns that approximately 80% of cryptocurrency projects that have experienced hacking incidents are failing to fully recover. Mitchell emphasized that the core issue lies not just in initial financial losses but in the operational paralysis and trust breakdown that occur during the recovery process. This poses a serious threat that goes beyond mere fund recovery and endangers the very survival of the projects.

The ‘Vicious Cycle of Trust’ Starting Immediately After Hacking

Most protocols become immediately disabled once a hacking incident is detected. Due to a lack of proactive response systems, they fall into a vicious cycle that leads to additional losses. Users lose confidence in the protocol’s security and leave the project regardless of whether funds are recovered. Mitchell pointed out that simply compensating for losses is insufficient to regain the lost trust.

Record-breaking Losses in 2025… Restoring Trust Is Key

According to the latest data, total losses from cryptocurrency-related hacks in 2025 reached $3.4 billion, the highest since 2022. Notably, three major incidents, including the $1.4 billion hack of Bybit in early December, accounted for 69% of the total losses. These statistics highlight that the entire industry’s security systems remain vulnerable and underscore the importance of trust recovery after hacks. Projects must go beyond just recovering funds and focus on transparent communication and systematic rebuilding plans to regain community trust and ensure survival.