CipherTrace’s Report on the Security of Cryptocurrencies

Last Modified:12 May 2020 11:58:45
CipherTrace’s Report on the Security of Cryptocurrencies

Among the features of cryptocurrencies that made them so popular is their security.

It is said that cryptocurrencies have a high security and it is not easy to manipulate them. If this claim is to be true, then what about all the news of hacking and stealing cryptocurrencies?

Research by CipherTrace indicates that in 2018, $1.7 billion’s worth of cryptocurrencies have been obtained through theft and scams. Of this $1.7 billion, more than $950 million has been stolen through trading cryptocurrencies which is a 3.6 percent increase in theft compared to that of 2017. Furthermore, $725 million has been stolen in 2018 through scams like Ponzi schemes, exit schemes, and offering fake coins. Of this amount, $6 million was Bitcoin, of which $4 million went missing, and $2 million was stolen.

CipherTrace has published a list of 10 different scams commonplace in the field of cryptocurrencies:

The first on the list is SIM swapping, which is assumed a type of identity theft and includes taking over the victim’s phone number in order to gain access to authentication codes. Among other cited threats is crypto dusting, which is sending destructive cryptocurrencies to a large number of different addresses.

Also, promoting cryptocurrencies to circumvent international sanctions, which is backed by countries such as Iran and Venezuela, is among the illicit ways to use cryptocurrencies.

According to a report by Cointelegraph, research by Chainanalysis showed that two groups of hackers that are possibly still active have stolen $1 billion’s worth of cryptocurrencies. These two groups that are called Alpha and Beta are responsible for 60 percent of exchange and overseeing services hacks.

Two weeks ago, New Zealand-based exchange Cryptopia was hacked. The final amount of theft is not yet clear.