Report: Two Hacker Groups Stole $1 Billion From Crypto Exchanges
A new report alleges that just two groups of hackers dominate the majority of cybercrime directed against cryptocurrency exchanges. Together, these groups have responsible for stealing about $1 billion of cryptocurrency so far.
Also Read: Arwen Enables Self-Custody for Traders of Centralized Exchanges
The Most Lucrative of All Crypto Crimes
Digital surveillance company Chainalysis has released its latest “crypto crime” report, claiming to identify two groups responsible for the majority of hacks in the field. Its findings were obtained in part by analyzing the different practices the thieves used for laundering their illicit gains.
On average, the incidents that the researchers traced from the two hacking groups involved $90 million per incident. They suspect that the first group is a “giant, tightly controlled organization” that may be partly driven by non-monetary goals. The second group is found to be smaller and less organized but absolutely focused on money and without much regard for evading detection.
“Hacking dwarfs all other forms of crypto crime, and it is dominated by two prominent, professional hacking groups,” the Chainalysis team wrote. “Together, these two groups are responsible for stealing around $1 billion to date, at least 60% of all publicly reported hacks. And given the potential rewards, there’s no question hacking will continue; it is the most lucrative of all crypto crimes.”
Most Stolen Crypto Laundered on Exchanges
According to the report, at least 50 percent of the stolen funds were cashed out through some type of conversion service within 112 days of the hacks. The researchers found that 64.3 percent of the funds were sent to centralized cryptocurrency exchanges, 11.9 percent to peer-to-peer exchanges and the remaining 23.8 percent went through other conversion services such as mixing services, bitcoin ATMs and gambling sites.
“Exchanges are regularly processing the stolen funds, allowing the hackers to convert the funds to traditional currencies or other cryptocurrencies,” the Chainalysis team explained. “This is in part because unless you’re the exchange that was hacked, these funds look like they have come from legitimate owners (that is, the original entities who were hacked); it is hard to tell which funds have been stolen and which haven’t without specialized investigation software.”
Chainalysis recently announced the launch of Know Your Transaction (KYT) for stablecoins, an anti-money laundering (AML) compliance solution for monitoring stablecoin transactions from issuance to redemption.
What do you think about the findings of this report? Share your thoughts in the comments section below.
Images courtesy of Shutterstock.
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