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The 10 biggest Bitcoin & crypto hacks of all time

Republished by Plato

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In recent years the amount of money that has gone into the Bitcoin and crypto market has been enormous. Combined with a huge bubble and growth took the overall cryptocurrency market’s value up by ten folds.

And this huge rise in value over the past ten years has not only attracted investors hoping they could make a nice investment after a few years of holding. But it has also attracted some bad people, with bad intention.

Namely Bitcoin and crypto hackers.

And unfortunately a lot of them have been successful. And I wanted to share with you all this list of the 10 biggest crypto hacks of all time.

The crypto space has also been full of scams, with OneCoin and Bitconnect being two of the biggest ponzi scams affecting this space.

But in this article I will look into what are the ten biggest crypto and Bitcoin hacks.

10 biggest crypto hacks of all time

So let us explore the 10 biggest hacks that have happened so far in the cryptocurrency space.

1 ) Coincheck – 523,000,000 NEM ($534 million)

Coincheck & NEM crypto hack

This record-breaking crypto hack valued at $534 million, happened to Japanese cryptocurrency exchange Coincheck in January 2018.

This staggering amount is the biggest hack that have ever happened in the Bitcoin and crypto space. Even bigger than the famous Mt.Gox hack.

According to reports, personal computers of staff working for Coincheck was exposed to viruses (that is rumoured to lead back to hackers of Russian origin).

There’s been other reports of North Korea being behind this hack. But according the recent analysis of the virus it is more likely from Russia.

According to reports Coincheck did not use multi-signature wallets or smart contracts securing these huge sums. So the hack was too easily achieved is commonly agreed by security experts.

2 ) Mt. Gox – 850,000 BTC ($460 million)

Mt. Gox - Wikimedia Commons
Mt. Gox

This is the most famous ever Bitcoin hack. And one that has had huge effects on the Bitcoin and cryptocurrency market for years to come.

The incredible amount of 850,000 BTC was at that point valued at $460 million.

In February 2014 hackers managed to get into the wallets of Mt.Gox the previous biggest Bitcoin exchange, and steal funds to the value of $460 million.

Most of those belonging to users that kept their funds on the exchange. 850,000 BTC would be worth about $8.2 billion today.

Since this famous Bitcoin hack there’s been scandals and lawsuits consitently filling the news but today it has not yet been settled yet. The users that have affected by the hack are still working on getting reimbursed through legal fights.

3 ) QuadrigaCX ($190 million)

Quadriga CX exchange deceased founder Gerald Cotten

Now this affair has like the previous two not completely understood or settled.

It is not really a true cryptocurrency exchange hack, but we thought to include this sad affair still.

The scandal of QuadrigaCX emerged when it became known that the founder Gerald Cotten died while traveling abroad in India in 2019. And not only that, he apparently died with having sole access to the private keys to the cryptocurrency exchange’s wallets.

So over $190 millions in users and exchanges funds were lost, with no one having access to them.

It has later been reported that Cotten had been embezzling the users of his exchange for years. And that he credited his own accounts with millions of dollar which he traded for real funds with users throughout the years.

And no one knows the exact amounts or what exactly happened it is rumored that he embezzled funds to the values of at least $80 million if not much more than that (learn more about Cottens embezzlement).

4 ) BitGrail 15 million XRB ($170 million)

Nano and Bitgrail

In 2018 the cryptocurrency exchange BitGrail was at the centre of all the attention in the crypto space. When it became clear that owners of the cryptocurrency Nano (then XRB – Raiblocks) that their funds had been lost.

NANO to a value of $170 million was at that point gone and everyone was trying to find out exactly what had happened.

The Italian exchange with its founder Francesco Firano tried to shift blame to the team behind NANO and others. But has since been ordered by the court to repay its users after several events linking back to bad practices. But he has since declared bankruptcy.

5 ) CoinBene ($105 million)

Coinbene hack message

CoinBene was in 2019 exposed to a hack that left the Singapore based cryptocurrency exchange at a loss of about $105 million.

At first, the exchange tried to deny the fact that they had been hacked. And when users of the exchange started suspecting they’ve been hacked CoinBene was trying to say it was undergoing maintenance.

Fast forward a few weeks later until the exchange confirmed in a tweet that in fact they had been hacked.

So about $105 million worth of ERC-20 tokens were stolen from the exchange, including Pundi X (NPXS), Maximine Coin (MXM) Huobipool Token (HPT) and Udoo (UDOO).

6 ) Bitfinex 120,000 BTC ($72 million)

BITFINEX logo on company website displayed on computer screen

In 2016 Bitfinex was exposed to a serious hack where nearly 120,000 BTCs worth at that ppint $72 million were stolen from the popular crypto exchange.

Bitfinex was at that point of the largest Bitcoin trading exchanges in the world. So it was a attractive choice for hackers.

This massive crypto hack had huge effects on the market, with the value of Bitcoin slumping, with the value of BTC dropping more than 20%

But also it continued to paint the Bitcoin and crypto market in a bad light.

A few years later in 2019, the Israeli Police cyber unit had arrested two Israeli brothers who allegedly was part of the hacker team behind the Bitfinex hack (read more).

7 ) NiceHash – 4,736 BTC ($64 million)

NiceHash website, 4,736 BTC stolen from this mining marketplace

The popular cloud mining was in 2017 hacked and more than $64 million were stolen from the site, and users of NiceHash.

This was a huge hack and it directly came from users funds stored on the platform tied up to various of Bitcoin and crypto mining setups.

After the hack the NiceHash CEO quit, taking part of the blame for the successful breach against NiceHash.

They have since worked on reimbursing the users what was stolen. And at this point in time, they have since reimbursed users up to 82% of the 4,736 worth of Bitcoin that was stolen. And this where it stops.

They announced in December 2019 that they will not be able to complete the reimbursement. And leaving the users out of the remaining missing funds (read more).

8 ) Zaif – 5,966 BTC ($60 million)

The Zaif Hack valued at $60 million

In 2018 the Japanese cryptocurrency exchange Zif was hacked, and Bitcoins, Bitcoin Cash and MonaCoins to a value of about $60 million were stolen from the exchange.

The funds were stolen from crypto held in hot wallets.

Since then analysis has been done on where the coins went. And 30% of the stolen Bitcoin still remains in an address associated with the hacker.

And 24% were sent to Binance for exchange and withdrawals.

With the remaining 46% split into small amounts and a number of different addresses. This information has been tracked by BitFury’s Crystal Blockchain Analytics team.

9 ) Upbit – 342,000 ETH ($51 million)

Upbit website screenshot - South Korean crypto exchange that in 2019 was hacked and 342,000 ETHs were stolen

Upbit the South Korean crypto exchange was in 2019 hacked and $51 million worth of ETH was stolen.

The staggering amount of 342,000 Ethers that was stolen from the exchange’s hot wallet was yet another crypto hack that happened in 2019.

Since then some of the funds have been on the move, and later on, $51.7 million worth of ETH was moved between different wallets. With the hacker labeling the transaction with “1337”.

Since then Upbit is still around and has announced an important security update. To make sure this won’t happen again in the future.

10 ) Vircurex ($50 million)

Vircurex - Bitcoin Wiki

Vircurex was in 2013 hacked twice, which left the exchange at a loss of about $50 million combined.

And after those two hacks which left the exchange without its reserve fund. And Vircurex then moved to freeze all transaction from the exchange.

Leaving the users without access to their money. And still today most of the funds are still locked away from its users on the exchange.

And Vircurex has since been suid by its customers. Demanding access to their funds.

Conclusion

So what should you take away from this? These huge crypto hacks have been very unfortunate. But there are lessons to learn from this.

Well for one the Bitcoin and cryptocurrency market has had some of the world’s biggest ever hacks. This is in itself something astounding and depressing.

And the second takeaway would be that you should really think twice about ever leaving big sums of funds on any exchange for too long.

Are you today holding most of your funds on an exchange?

Then you are sharing your private keys to the exchange. And potentially the hackers to get away with your cryptos. Or even the people running the exchange themselves.

Greed can come from any corner. And so I urge anyone reading this to explore how cryptocurrency wallets work. And then to avoid leaving their funds on an exchange unless 100% secure. And today no exchanges really offer a 100% security to your funds.

Binance is one of few that is saving up a reimbursement fund in the case of hacks. Which has been triggered before. But will it cover bigger hacks in the future?

So invest in a safe wallet, I’d recommend a Ledger or Trezor wallet. But there are free versions also where at least you own the private keys and no one else.

Find other guides

  1. Best way to invest in crypto
  2. Bitcoin investing guide
  3. Best Litecoin wallets
  4. Buy IOTA guide
  5. Gemini vs Coinbase review

Source: https://gocryptowise.com/blog/10-biggest-bitcoin-crypto-hacks/

Blockchain

Crypto Investment Fund to Sell $750M in Bitcoin for Cardano and Polkadot

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Dubai-based cryptocurrency investment fund currently sitting on $1 billion in AUM believes that the value of Cardano and Polkadot will be higher than that of BTC in the upcoming years. Consequently, the fund has announced plans to dispose of $750 million of its Bitcoin holdings and expand its exposure to ADA and DOT instead.

Crypto Fund To Replace BTC With DOT and ADA

FD7 (Fall Down Seven Times) Ventures describes itself as a crypto-oriented investment fund that “invests in entrepreneurs who stand up an 8th time” and has over $1 billion in AUM in various crypto assets. Naturally, those include the two largest – Bitcoin and Ethereum – as well as Cardano, Polkadot, and Cosmos.

According to a company press release, though, the fund plans to rebalance its portfolio by selling off $750 million worth of its Bitcoin exposure over the next month. Instead of holding BTC, FD7 intends to accumulate more of the “rising projects Cardano and Polkadot.”

The firm believes that this increase of altcoin holdings will “better serve the needs of FD7 investors who are looking to diversify their portfolios in the growing cryptocurrency space.”

The fund’s Managing Director had some harsh words to say regarding the primary cryptocurrency following the announcement:

“Aside from the fact that Bitcoin was the first to market and society has given it meaning as a store of value, I think Bitcoin is actually pretty useless.”

In contrast, he highlighted the potential of projects such as Ethereum, Cardano, and Polkadot, which he believes “will be more valuable than Bitcoin within the next few years.”

Ultimately, the statement informed that the fund has already started converting its BTC holdings to ADA and DOT.

Charles Hoskinson Welcomed The News

The press release described the founders of Cardano – Charles Hoskinson and Polkadot – Dr. Gavin Wood as “two of the brightest minds working in the crypto development space today” and outlined their vital role in establishing Ethereum years ago.

The fund’s decision to prioritize its ADA and DOT investments was primarily based on their reputation.

Hoskinson was quick to respond to the news from his Twitter account. Somewhat expectedly, he welcomed FD7 Ventures to the Cardano ecosystem and offered technical assistance if needed.

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Source: https://cryptopotato.com/crypto-investment-fund-to-sell-750m-in-bitcoin-for-cardano-and-polkadot/

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Blockchain

Wall Street Asset Manager Stone Ridge Files to Add Bitcoin to its Diversified Alternatives Fund

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New York City-based asset manager Stone Ridge has filed documents with the US Securities and Exchange Commission on behalf of its diversified alternatives fund to introduce BTC as the seventh investment strategy. 

  • According to the filing with the SEC, the addition will become effective on April 26th, 2021. However, it doesn’t necessarily mean that the giant asset manager will proceed with its BTC endeavor.  
  • The filing enables Stone Ridge to receive exposure for its diversified alternatives fund to Bitcoin through put options on BTC futures contracts. Put options allow investors to sell a certain amount at a pre-determined price in the future, but they are not obliged to.  
  • The Wall Street firm suggested that future allocations in BTC could include putting funds in pooled investment vehicles with exposure to the cryptocurrency. 
  • SkyBridge Capital’s Anthony Scaramucci also commented on the development and he classified it as a “big deal” that would “open the door for every mutual fund to add Bitcoin.
  • Since 2012, Stone Ridge provides services to accredited investors as a registered investment advisor (RIA) and had over $13 billion in assets under management as of late 2020. 
  • It’s worth noting that Stone Ridge already has substantial connections with the primary cryptocurrency. A Forbes article followed the path that started with staff members purchasing BTC for themselves years ago. 
  • As the company was struggling with storing their funds, it founded the crypto asset manager New York Digital Investment Group (NYDIG) in 2017. The new endeavor raised over $6 billion in AUM in its four years of existence, and the Executive Chairman, Ross Stevens, recently projected $25 billion by the end of the year. 
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Source: https://cryptopotato.com/wall-street-asset-manager-stone-ridge-files-to-add-bitcoin-to-its-diversified-alternatives-fund/

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Blockchain

Here’s what you should know about Bitcoin collateralized Futures

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Before DeFi was bursting onto the scene, bringing forward the idea of tokenized Bitcoin on Ethereum, the derivatives markets were the ones to introduce the concept of using digital assets as collateral.

The rise of derivatives has played a vital role for Bitcoin, allowing the asset to undergo price discovery. With growing traction, the financial structure around it continued to develop, and the collateral aspect of Bitcoin started to gain stability.

Other factors have assisted Bitcoin in idolizing the role of a good collateral asset. The growth of institutional interest has been key. Over the past year, the volume of Bitcoin currently accumulated by institutions has climbed as high as ~6% of the total circulating supply, a figure that comes up to around 1.3 million.

Improving social sentiment has provided collective acceptance as well. Multiple traditional stock investors such as Paul Tudor Jones have applauded Bitcoin’s emergence, suggesting that the asset class has a lucrative standing in the future.

The growth of Bitcoin collateralized futures was inevitable, but a change might have been taking place over the last 12 months.

BitMEX led the initial charge, but is there a shift afoot?

According to Arcane Research’s recent report, BitMEX was the derivatives exchange that introduced the idea of BTC collateralized Futures. Between 2017 and 2018, the trading volume of BitMEX completely surpassed the spot volume market of Bitcoin.

After BitMEX dominated proceedings post the 2017 bull run and during the bearish winter of 2018, the Open Interest on BTC Futures registered its biggest rise in 2020, with the market ballooning up to $14 billion in January.

Source: Arcane Research

However, after the March 2020 crash, the derivatives market appeared to radically shift towards stablecoins and USD collateralized Futures.

As can be seen from the attached chart, Open Interest by BTC margined Futures or perpetual swaps cater to 57% of the total Open Interest by collateral. Stablecoins margined Futures have risen by 43%. For context, Bitcoin margined Futures dominated 86% of the Futures market on 1 January 2020.

At press time, it was estimated that the size of BTC collateral in the Futures market was close to 20,000-60,000 BTC. Here, it is worth noting that the range is particularly wide because the derivatives industry is relatively opaque, especially when compared to the spot market.

While stablecoin margined Futures remain in the backseat because they are less complex than BTC-collateralized futures, a change in positions might just manifest sooner than expected.


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Source: https://ambcrypto.com/heres-what-you-should-know-about-bitcoin-collateralized-futures

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