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Cryptocurrency investors have really taken a beating this year from all the hacking and scamming going on. Cybercriminals have found an especially useful way to reach their victims—crypto bridges.
Crypto bridges are websites or apps that allow users to buy, sell, or trade cryptocurrencies and digital assets. They’re similar to traditional online exchanges, but they don’t have the same level of regulation. This makes them a perfect target for hackers and scammers.
$1.4 billion has been lost to breaches on cross-chain bridges this year, according to blockchain analytics firm Chainalysis. The most important single event was the $615 million haul taken from Ronin, a bridge supporting the popular nonfungible token game Axie Infinity, which allows players to make money while playing.
In addition, Wormhole, a crypto bridge backed by Wall Street high-frequency trading firm Jump Trading, had $320 million stolen. In June, the Horizon bridge on Harmony’s network was subjected to a $100 million assault. Last week, hackers stole almost $200 million in a breach of Nomad.
“With billions of dollars worth of cryptocurrency assets trapped inside, blockchain bridges have become a ripe target for hackers, with low-hanging fruit like this being plucked,” said Tom Robinson, co-founder and chief scientist at blockchain analytics firm Elliptic stated in an interview. “Several of these bridges have been hacked in a variety of ways, suggesting that their security has not kept up with the value of assets they protect.”
Bridge exploitation is occurring at an alarming rate, considering it’s such a new phenomenon. According to Chainalysis statistics, bridge heists have resulted in the loss of 69% of crypto-related robberies through 2022.
This is quite a turn of events, as just last year, bridges were only responsible for 5% of all crypto losses.
With the amount of money being lost to these types of attacks, it’s no wonder that investors are getting more and more nervous about keeping their money in digital form. If the current trend continues, we could see even more people abandon cryptocurrencies altogether.
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