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Since their emergence and almost prophetic destiny, cryptocurrencies, crypto-mining, and indirectly the blockchain system, have been unwittingly discovering the limits of their infallibility.
In fact, this new payment system, particularly “trendy” thanks to Bitcoin’s popularity, has been the target of almost continuous attacks since its democratization. Hackers have repeatedly managed to breach platforms and steal the contents of virtual vaults.
Theft, scams, ransomware, fraud: cybercrime continues to severely impact blockchain and the growing liquidity of cryptocurrencies. Looking back, 2019 remains the worst year, with over $4.5 billion falling into the hands of malicious individuals or organizations. That said, 2021 is already off to a flying start.
Law & cryptocurrencies: €1.5 billion in cryptocurrencies stolen in 2018
A succession of companies operating cryptocurrency platforms have fallen victim to cyberattacks in recent years, resulting in thefts of valuable assets: in 2018, the Japanese company Coincheck lost €426 million; since January 2019, successively, the New Zealand-based Cryptopia lost €14 million, the South Korean Bithumb lost $17 million, the Singaporean DragonEx lost $8 million, and CoinBene and the Singaporean company Bitrue lost €4 million.
Last July, the Japanese cryptocurrency exchange platform Bitpoin, owned by the company Remixpont, was hacked, with the perpetrators stealing the equivalent of €29 million in various digital assets: Bitcoin, Bitcoin Cash, Ethereum, Litecoin, and Ripple.
Two groups of hackers are believed to be behind 60% of all publicly known cryptocurrency exchange hacks and to have stolen approximately $1 billion worth of cryptocurrency, according to a report published last week by blockchain analytics firm Chainalysis.
States and Big Tech companies developing their models: Libra and cryptocurrencies
The fragility of cryptocurrencies raises the difficult question of their recognition by states as a reliable means of payment. Through various setbacks and obstacles, the cryptocurrency world is gradually stabilizing its ecosystem. Innovative methods are being developed in parallel to enhance the security of these transactions, particularly to ensure their confidentiality—new exchange and anonymization protocols, the introduction of cryptographic signatures 2.0, zero-knowledge proof mechanisms, and so on. Several banks, service providers, and even governments are thus preparing to launch their own cryptocurrencies.
Facebook, the tech giant, is about to launch its own cryptocurrency, “Libra,” in order to penetrate the online financial services market. This cryptocurrency, based on a private blockchain, will have to prove the robustness of its code, like its competitors, to prevent hacking.
As of May 2021, Facebook’s Libra cryptocurrency has not yet launched and is not yet available on exchanges. The reluctance of several governments, who see it as a threat to their monetary sovereignty, and the withdrawal of major financial partners have delayed the currency’s official launch and widespread adoption.
In France, Finance Minister Bruno Le Maire has made no secret of his concerns about Libra’s arrival and has positioned himself as a staunch opponent of its introduction. Russia has announced that it will not legalize it, and Washington remains unconvinced.
In mid-August, China also announced the creation of a sovereign Chinese cryptocurrency, controlled by the government. This announcement is part of the ongoing campaign, which began in 2017, to ban ICOs (Initial Coin Offerings), Bitcoin mining, and, more generally, to shut down over a hundred foreign cryptocurrency exchanges within its borders.
Cryptocurrency offenses in 2019: theft and fraud news
2019 saw a significant number of cryptocurrency attacks:
- The Cryptopia cryptocurrency exchange in New Zealand was hacked in January 2019, revealing up to $16 million in potential losses.
- In February of the same year, Coinmama was informed that 450,000 user accounts were for sale on the Dark Web.
- In March 2019, Bithumb reported its third security incident in two years, with over $20 million in EOS and Ripple tokens stolen.
- In May 2019, the Bestmixer platform was seized by Europol, which is being prosecuted for laundering over $200 million through cryptocurrencies.
- In June, six arrests in the UK and the Netherlands by Europol and Eurojust targeted individuals who had defrauded the Bitcoin market of up to €24 million.
- In September 2019, a hacker was charged in connection with 2017 cyberattacks targeting the EtherDelta cryptocurrency.
- In November 2019, the South Korean exchange PureBit allegedly carried out an exit scam, siphoning off $3 million worth of Ethereum.
Find the detailed list of thefts and offenses detected in the crypto-market.onnaies.
