Cryptocurrency thefts have seen a significant increase in the first half of this year, with hackers focusing on centralized exchanges. According to a report from blockchain analysis firm Chainalysis, stolen funds and ransomware were the two categories that experienced an increase in illicit cryptocurrency activity. Stolen funds saw the largest gain, with criminals already appropriating $1.58 billion in the January to July period, an 84.4 percent increase compared to 2023.
The report highlighted a resurgence of hacking activity after a 50 percent drawdown in crypto value stolen in 2023 compared to the previous year. Blockchain intelligence company TRM Labs also reported a surge in theft from crypto hacks and exploits in 2024, without identifying any fundamental changes in the security of the cryptocurrency ecosystem that could explain this increase.
Both Chainalysis and TRM Labs attributed the rise in theft volumes to significantly higher average token prices in the past six months compared to the same period last year. The price of bitcoin, for example, increased by 130 percent from an average of $26,141 in the first seven months of 2023 to an average of $60,091 this year through July.
The average value of stolen funds per incident also increased by nearly 80 percent to $10.6 million. Bitcoin accounted for 30 percent of the transaction volume of stolen funds last year, but this year it made up 40 percent of the volume.
Hackers are increasingly targeting centralized exchanges to steal crypto assets, with the report citing the hack of Japanese crypto platform DMM Bitcoin as an example. Social engineering tactics, such as applying for IT jobs, are being used by attackers, including those from North Korea, to infiltrate centralized exchanges and steal assets.
Ransomware payments have also reached a new high, totaling nearly $460 million in the first half of this year. The Chainalysis report predicts that this year is on track to be the highest-grossing ransomware year yet, surpassing the record set last year with over a billion dollars paid in ransoms. Despite significant law enforcement actions, high-profile ransomware payments continue to occur.
Ransomware remains a key disruptor in the United States, with the U.S. Department of Justice elevating ransomware investigations to a similar priority level as terrorism in 2021. This decision came after cyberattacks crippled American infrastructure and paralyzed key industries. The U.S. Cybersecurity & Infrastructure Security Agency (CISA) also highlighted the costly and destructive nature of ransomware attacks, estimating that they cost businesses an average of $1.85 million to recover from. Additionally, 80 percent of victims who paid ransoms were revictimized by hackers.
Overall, the increase in cryptocurrency thefts and ransomware attacks highlights the persistent challenges faced by the cryptocurrency ecosystem and organizations worldwide. The surge in average token prices and the targeting of centralized exchanges by hackers contribute to the rise in illicit activity. As these threats continue to evolve, it is crucial for individuals and organizations to prioritize cybersecurity measures and remain vigilant against potential attacks.
