It has come to light that the M2 crypto exchange was recently targeted by hackers and lost around $13.7 million in Bitcoin in such an attack. This is one of the major losses within the crypto space, which has seen several high-profile hacks in recent times. M2 confirmed this in an official announcement on October 31.
This breach also comes only some months after WazirX, an Indian crypto exchange, suffered a much larger hack, losing more than $230 million. The WazirX hack happened less than four months prior; it is among one of the most serious hacks against cryptocurrency this year.
As cryptocurrency becomes more popular, security breaches continue to raise fears among both new and seasoned investors. Over the past 13 years, data shows that hacking incidents have led to almost $19 billion in losses. These losses stem from roughly 785 recorded cases. These statistics put a number on the scale of the security challenge in the crypto world.
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One of the most notorious crypto thefts in history took place in 2019 with the PlusToken scam, in which attackers walked away with $2.9 billion in Bitcoin and Ether. Even with advancements in security measures, major breaches have continued to occur regularly.Â
Earlier this year, the PlayDapp breach led to $290 million in losses, making it the largest single crypto heist of 2024 to date. Additionally, the JPEX scam in Hong Kong has contributed significantly to this trend. In this elaborate investment fraud, hackers stole $194.3 million. This case also shows how hackers exploit a range of vulnerabilities in the system.
Centralized cryptocurrency exchanges (CEXs), like M2 and WazirX, are among the most common targets for hackers. Although centralized exchanges generally offer convenience and easy access to digital assets, their security vulnerabilities have raised concerns.Â
Unlike decentralized platforms, CEXs often rely on centralized security protocols, making them easier targets for attackers who can find ways to breach their defenses. The convenience of hot wallets, which store assets online for quick access, often comes at the expense of security, as seen in the M2 hack.
The beginning of 2024 continued the trend: more than $542.7 million was stolen in the first quarter. In 2024’s first quarter alone, thefts increased by 42% compared to the same period in 2023. This troubling rise indicates that security issues are only becoming more serious. As a result, security remains a major challenge for both centralized and decentralized crypto platforms.
While decentralization and transparency in crypto are attracting an audience from across the world, hacks and fraud schemes continue to depict a not-so-rosy outlook for both users and regulators. For digital assets to gain widespread acceptance, the industry must prioritize strengthening security. Improved safety measures are crucial for building user confidence, especially among those who are skeptical about crypto. Each new security breach and subsequent wave of skepticism could slow the path forward even more.
Disclaimer
FAQ
Cryptocurrency is a digital form of currency secured by cryptography, not controlled by governments or banks.
Cryptocurrency wallets are digital tools for storing and managing your crypto assets.
Best practices for crypto investment include research, diversification, investing what you can afford to lose, and avoiding hype-driven investments.
