Security flaws, hacks, and rug pulls are some of the biggest concerns for the crypto world. The amount of money that gets swept off accounts via illegal means is increasing daily. According to the latest report by SlowMist, May recorded 32 separate cases of compromised archives, with a total loss of almost $429 million.
These instances were caused by account theft, address spoofing assaults, rug pulls, and security and contract weaknesses. The research also highlighted that this month saw four security incidents that yielded almost $92.58 million in recovered funds, with three of those occurrences accounting for nearly all assets.
May’s two biggest losses came from a phishing attack that used address spoofing and a security flaw. The losses from these two occurrences alone were over 375 million dollars. Moreover, losses of over $26 million were caused by two instances of private key leaks. Of the thirty-two security events this month, fourteen (or almost forty percent) were caused by contract vulnerabilities.
Why Is Crypto World Prone to Hacks?
The continuous bull run in the cryptocurrency market has driven prices to all-time highs as a result of regulatory innovations and noteworthy events like the Bitcoin (BTC) Halving and the approval of crypto exchange-traded funds (ETFs) in the US and Hong Kong. Even so, the industry has seen a rise in losses linked to breaches and rug pulls along with this upward trend.
The storage of private keys is one of the two primary weaknesses in blockchain technology and cryptocurrencies. If you lose the keys, you have no say over what happens to your cryptocurrency. A custodial relationship between the key owner and the key holder is when you give someone else control over your cryptocurrency holdings by letting them store your keys.
The good news is that security protocols and countermeasures for cryptocurrency platforms are evolving along with them. When crypto platforms react swiftly to vulnerabilities, law enforcement authorities will be better equipped to contact exchanges where frozen money is kept to begin confiscation and contact services through which the funds are moved to collect pertinent information about accounts and individuals.
