Protecting Cryptocurrency from Theft: Key Security Practices

By Terry Ashton, updated January 23, 2025

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Cryptocurrencies are relatively new, having only gained worldwide popularity in the last decade. Much like traditional currencies, they are subject to threats and security issues that can result in significant financial loss. In fact, substantial security breaches have resulted in the loss of billions of dollars, with 2022 alone seeing a record loss of $3.8 billion. Protecting cryptocurrency from theft has become crucial as these vulnerabilities continue to pose risks to investors.

These significant losses have happened through numerous security breaches, and here we will dive into the 10 most significant breaches in the history of cryptocurrency.

1. Ronin Network $625 Million

The Ronin Network is a blockchain for gaming platforms and is best known for its video game and NFT market, Axie Infinity. In March 2022, hackers targeted Ronin and caused the largest security breach in cryptocurrency, stealing over $620 million. Experts believe the Lazarus Group, based in North Korea, carried out the cyberattack.

2. Poly Network $611 Million

In August 2021, an unknown hacker broke into Poly Network, a platform that allows users to trade one form of cryptocurrency for another, and stole over $600 million. The hacker seemingly treated the breach as a game, just testing whether they could break into the system and take money. Eventually, Poly Network set up addresses where the hacker could return the stolen funds, and the platform recovered all of the money.

3. Binance $586 Million

Similar to Poly Network, Binance is another platform that allows users to exchange one cryptocurrency for another. In October 2022, hackers targeted Binance in a way similar to Poly Network. The BNB Bridge, which transfers crypto from one blockchain to another, suffered a hack, and platform users lost millions of dollars. Unlike the Poly Network theft, however, the platform did not recover the stolen funds. Protecting cryptocurrency from theft has become even more critical as hackers continue to target platforms like Binance.

4. Coincheck $534 Million

Hackers targeted another exchange platform, Coincheck, in January 2018 and stole over $500 million. At the time of the theft, this was the largest cryptocurrency breach in history. The company paid back its users and has remained in operation despite this substantial financial blow.

5. Mt. Gox $473 Million

Mt. Gox, yet another crypto exchange platform, faced one of the first crypto thefts in history in 2011, resulting in a loss of over $470 million worth of crypto taken. The company declared bankruptcy in 2014, and while it was an early leader in cryptocurrency exchanges, it is no longer in operation.

6. FTX $400 Million

The FTX exchange, much like Mt. Gox, was a well-known name in the crypto industry. In November 2022, however, it suddenly declared bankruptcy the same day many users saw their accounts drained entirely. This hack saw a loss of $400 million. Three people were eventually charged in the theft, but FTX never recovered from the scandal and is no longer operating.

7. Wormhole Network $325 Million

The Wormhole Network is a decentralized finance platform that allows you to spend, borrow, or lend without a go-between platform like a crypto exchange. Hackers targeted the platform in February 2022, stealing $325 million. The unknown hacker likely found a flaw in the organization’s code and exploited it to steal funds. Eventually, Wormhole’s parent company covered the losses.

8. Euler Finance $197 Million

Euler Finance is another decentralized finance platform that allows users to borrow or lend crypto. In March 2023, hackers targeted the platform and stole $197 million. Over several days, the hacker returned the stolen money to the platform.

9. BitMart $196 Million

BitMart is a crypto exchange platform, and like others on the list, it fell victim to a major cyber hack. The hack occurred in December 2021 and cost the company $196 million in losses.

10. Nomad $190 Million

Nomad had a security breach in August 2022 that cost the company $190 million. The hack took advantage of a coding vulnerability with a bug that Forbes said “was so simple that it didn’t even require any programming skills to exploit it.” And many copycat hackers took advantage of this shortly after the first breach occurred. Nomad was able to regain $20 million in losses. Protecting cryptocurrency from theft is essential as hackers continue to exploit vulnerabilities like these, causing significant financial damage.

How Do Hackers Manage to Steal from These Organizations?

Hackers can break into these systems in ways similar to how they target banks and other financial institutions, with hackers taking advantage of weaknesses in the organizations’ security systems and phishing schemes that target their users. In addition, crypto hacks are also attributed to the lack of government regulations.

Crypto exchanges and bridges are the most commonly targeted platforms because, unlike blockchains, there are more vulnerabilities hackers can take advantage of. But even crypto games like Axie Infinity (mentioned above) or online casinos like Stake.com, a destination for fast payout casinos, can (and have) fall victim to attacks.

Common methods of attacking or hacking cryptosystems include malicious code that exploits errors or weaknesses in a crypto organization’s code and phishing schemes to get personal information and keys or to get individuals to install malware unknowingly.

Protecting Yourself from Crypto Security Breaches

Although some methods hackers use to target cryptocurrency are beyond individual control, you can take steps to protect your cryptocurrency and lower your chances of being targeted. These protections include:

Keeping your cryptocurrency offline through a ‘cold wallet’ (an offline crypto storage method)
Installing firewalls and anti-virus software
Using password best practices like regularly updating your password
Using multi-factor authentication
Being aware of phishing schemes
Avoiding the use of crypto-exchanges for long periods at a time

Final Thoughts

Unfortunately, as these ten major security breaches show, crypto theft isn’t unheard of and is, in fact, relatively common. Naturally, this can cause anxiety or worry over investing in and getting involved in the world of cryptocurrencies. However, exercising caution and implementing security best practices at the individual level can help in protecting cryptocurrency from theft if you choose to dive into this new form of currency.

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