No one likes to lose their hard earned money from their cryptocurrency investments, however, some unforeseen events wipe out investors’ funds from their trading wallets. One of the popular practices is for hackers to lure investors into lucrative offers on social media platforms that look like clickbait in a certain cryptocurrency. Just one click, and before you know it, your money is out of your hot wallet. Whereas sometimes investors are left helpless when the money transferred by them to their account through ATM goes to the hackers. The latest example and casualty of hackers would be General Bytes-backed bitcoin ATMs and Solana wallets, where investors lost millions of dollars. Although there has been an increased awareness of cyber threats among investors in the crypto market, especially this year, however, the uncertainty is still concerning and is getting more advanced over time.
On August 18, in their security incident update, normal bytes Reported of a hack where attackers exploited a zero-day vulnerability in a server Bitcoin ATMs and managed to cheat investors’ money.
Earlier this month, the Solana token saw selling pressure on exchanges after users reported their funds ran out of “hot” wallets, including Phantom, Slope and TrustWallet, without their knowledge. Thousands of Solana investors suffered a huge setback. According to reports, Solana has been estimated to have recorded a loss of between $5 million to $8 million.
Solana and General Bites were another fish in the hackers’ pond. According to one analysis, nearly $2 billion worth of cryptocurrency has been stolen by hackers so far this year.
In its mid-year crypto crime update, last week Chainalysis revealed that overall, cryptocurrency transaction volume for both illegal and legitimate entities this year has been tracking back to July of 2021. Overall, criminal activity appears to be more resilient in the face of falling prices—illegal quantities declined just 15% year over year, compared to 36% for legal quantities.
According to Chainalysis mid-year report, total scam revenue for 2022 is currently $1.6 billion, which is 65% less than in 2021 as of the end of July. The forum said that the decline appears to be linked to a fall in prices across various currencies. ,
Also, the cumulative number of personal transfers in scams year-on-year in 2022 is the lowest in the past four years.
In the thoughts of Chainalysis, fewer people are falling for cryptocurrency scams than ever before. One reason for this may be that with asset prices plummeting, cryptocurrency scams – which generally present themselves as passive crypto investment opportunities with huge promised returns – are at risk for potential victims. are less attractive.
“We also anticipate that new, inexperienced users who are more likely to fall for scams are less prevalent in the market now, when prices are rising and they are falling in contrast to the hype and the promise of quick returns. are. ,” added the report.
In addition, darknet market revenue has also dropped significantly in 2022 and is currently down 43% compared to July last year.
On the other hand, data shows that as of July 2022, $1.9 billion worth of cryptocurrency has been stolen in services hacks, compared to just under $1.2 billion at the same time in 2021.
In its report, Chainalysis stated, “This trend is not set to reverse any time soon, with the cross-chain Bridge Nomad’s $190 million hack and the $5 loss of several Solana wallets already occurring in the first week of August.” With Million Hacks (neither depicted on the graph above because we chose July 31 as our cutoff point).”
The reason behind the hack can be attributed to the astonishing increase in funds stolen from the DeFi protocol – a trend that started in 2021.
Still, with the massive increase in stolen money, we cannot rest on our pride. The public and private sectors must continue to work together and strengthen their ability to fight cryptocurrency-based crime, the report said. should be rectified.”
While the hack is one of those unforeseen events that still swings as one of the major drawbacks for the cryptocurrency market. As an investor who has invested in cryptocurrencies, it is important to be vigilant and cautious while trading and protecting your investment in crypto.
How to protect your Hot Wallet from getting destroyed by hackers?
Purvi Sachar, Head, Operations, Tezos India said, “To protect one’s trade wallet from getting wiped out by hackers, one should avoid clicking on spam links on the internet. Do not share your keys (public/private). Highly recommended. With anyone.”
The user should not rely on any messages initiated from outside while engaging in the exchange. Sachar suggests using a cold wallet instead of a hot purse to protect your keys.
Cold wallets are less risky and the information remains with the customers. Cold wallets are offline which means they do not require internet services. They are hardware wallets as a physical medium that minimizes the possibility of data leaks and thefts – unless the user shares their details with anyone else.
Meanwhile, hot wallets are connected to the Internet and are part of cryptocurrency exchanges—so they are more vulnerable to cyber hacks.
“Hacking is rampant on social media, and its lucrative deals can fine users. Disconnect wallets on suspicious dApps and always revoke permissions after a transaction. Wallet messages should be familiar to those who have used it before. Extreme care should be taken during any transaction,” Sachar said.
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