Crypto Hacks and Crimes: A History of Digital Asset Theft

The Mt. Gox Bitcoin exchange suffered a major security breach when a hacker used stolen auditor credentials to transfer large amounts of Bitcoin and manipulate the price to USD 0.01. Over 2,600 BTC was stolen and 424,242 BTC was moved to cold storage to prove reserves.

Mt. Gox, the world's largest Bitcoin exchange handling 70% of all Bitcoin transactions, abruptly shut down and filed for bankruptcy protection in Japan. Approximately 850,000 Bitcoin, worth over USD 460 million at the time, had been stolen from its hot wallets over several years beginning in late 2011.

An attacker exploited a vulnerability in The DAO, a decentralized autonomous organization on Ethereum, draining approximately 3.6 million Ether worth USD 60 million. The hack led to a contentious hard fork of the Ethereum blockchain, creating Ethereum (ETH) and Ethereum Classic (ETC).

The Bitfinex cryptocurrency exchange was hacked, resulting in the theft of approximately 120,000 Bitcoin worth USD 72 million. The hack exploited Bitfinex's multi-signature wallet system. Bitfinex later issued recovery tokens (BFX) to affected customers.

Japanese cryptocurrency exchange Coincheck was hacked, losing approximately 523 million NEM tokens worth USD 534 million at the time. The hack, one of the largest ever, occurred because funds were stored in a hot wallet. Coincheck later reimbursed all affected customers.

Binance, the world's largest cryptocurrency exchange, suffered a security breach resulting in the theft of 7,000 Bitcoin (approximately USD 40 million). Hackers obtained user API keys and two-factor authentication codes. Binance covered the losses from its Secure Asset Fund for Users (SAFU).

The Ronin Network, a sidechain for the Axie Infinity game, suffered a bridge exploit that drained 173,600 Ethereum and 25.5 million USDC, worth approximately USD 620 million. Hackers compromised five of nine validator keys. The US Treasury later linked the attack to North Korea's Lazarus Group.

The TerraUSD algorithmic stablecoin lost its peg to the US dollar, triggering a death spiral that destroyed approximately USD 45 billion in market value within a week. The collapse led to contagion across the cryptocurrency lending market, forcing Celsius Network and Voyager Digital into bankruptcy.

A cross-chain bridge exploit on the BNB Smart Chain allowed an attacker to withdraw approximately 2 million BNB tokens worth USD 570 million. The hacker exploited a vulnerability in the Binance Bridge's proof-of-stake verification logic. Binance temporarily halted the chain and prevented most of the stolen funds from being transferred.

FTX, the third-largest cryptocurrency exchange, filed for Chapter 11 bankruptcy after it was revealed that customer funds were misappropriated to Alameda Research. Approximately USD 8 billion in customer assets went missing in what prosecutors described as one of the largest financial frauds in US history.

A cross-chain bridge exploit on the BNB Smart Chain allowed an attacker to withdraw approximately 2 million BNB tokens worth USD 570 million. The hacker exploited a vulnerability in the Binance Bridge's proof-of-stake verification logic. Binance temporarily halted the chain and prevented most of the stolen funds from being transferred.

Binance and CEO Changpeng Zhao agreed to pay USD 4.3 billion to settle charges with US agencies for violations of the Bank Secrecy Act and sanctions laws. Binance was found to have allowed illicit transactions including those by Hamas, ISIS, and ransomware attackers through its platform.

Terraform Labs co-founder Do Kwon pleaded guilty to two counts of fraud in US federal court, agreeing to forfeit USD 19 million. He was later sentenced to 15 years in prison for his role in the USD 45 billion Terra-Luna collapse that devastated retail investors worldwide.