Report: Hackers Hijack Up to 10% of Cryptocurrencies
Decentralized character of cryptocurrencies and blockchain is an apparent advantage against traditional financing though being at the same moment a backdoor for hackers. New ICO report states it, up to 10% of all funds owned by primary investors have been stolen by hackers.
Although Bitcoin and altcoins have been experiencing intensive growth recently, the 2017 boom they saw was partially caused by increasing number of ICO. The trend has got weaker in the last few months yet resulted in numerous cyber attacks at both crypto exchanges and common users.
The report released by Ey Research voiced the idea that focus on the project’s PR often implies security coming second so phishing attacks at cryptocurrency initiators and investors become pervasive. This may include wallet address change or login data theft via phishing sites. Other methods are about DoS-attacks at ICO websites as well as at employees and IT environment.
In some cases significant losses come from damaged cryptocurrency itself. Losing part of invested funds may speak of new ICO lacking security thus tainting the image of the cryptocurrency on the long-term basis and affecting its cost.
This is fraught with serious consequences much more than traditional bank break-in. According to the Ey Research, average bank hacking causes $1.5 mln loss with critical insurance cover. On the other hand, crypto exchanges hacking losses have exceeded 2 bln dollars in few years already while absence of reversible transactions and increased anonymity making it more inviting for hackers.
The report says that amid frequent hacks crypto users and investors must treat security matters more cautiously.