{"id":89202,"date":"2023-08-01T10:13:24","date_gmt":"2023-08-01T10:13:24","guid":{"rendered":"https:\/\/www.techopedia.com"},"modified":"2023-09-20T12:03:46","modified_gmt":"2023-09-20T12:03:46","slug":"how-much-money-are-state-backed-hackers-making-in-crypto","status":"publish","type":"post","link":"https:\/\/www.techopedia.com\/how-much-money-are-state-backed-hackers-making-in-crypto","title":{"rendered":"How Much Money Are State-Backed Hackers Making in Crypto?"},"content":{"rendered":"

As we venture deeper into the digital age, we are faced with the emergence of new, intangible threats \u2013 with no industry more exposed than cryptocurrency<\/a> against the rise of the state-sponsored crypto hack.<\/p>\n

Among these is state-sponsored hacking<\/a> \u2013 an alarming phenomenon given its geopolitical implications and potential to disrupt the global economy.<\/p>\n

However, the money that these state-backed hackers amass, particularly through cryptocurrency, has largely remained a mystery.<\/p>\n

This article aims to shed light on this enigma by tracing the trail of state-backed hacking in the crypto sphere and estimating how much these digital pirates<\/a> are truly earning.<\/p>\n

The Rise of State-Sponsored Crypto Hacking: An Overview<\/span><\/h2>\n

Reports indicate a record $3.8 billion worth of cryptocurrency<\/a> was stolen last year, with North Korean-linked hackers contributing significantly to the figure.<\/p>\n

The shift in focus to cryptocurrency is not random: blockchain<\/a>-based currencies offer the promise of anonymity and are hard to trace, making them perfect for nefarious activities.<\/p>\n

North Korean hackers, for instance, pilfered an estimated $1.7 billion in 2022<\/a>. They were implicated in some of the most significant crypto hacks of the year, including the $600 million Ronin network breach and a $100 million attack on Harmony.<\/p>\n

This suggests that cryptocurrency hacking contributes a significant portion to North Korea’s economy, given that the nation’s total exports in 2020 were valued at $142 million<\/a>.<\/p>\n

The hacks are not limited to North Korea, with other shady states also suspected of funding similar operations.<\/p>\n

While it’s challenging to quantify the exact amount stolen due to the secretive nature of these operations, the scale is undoubtedly vast.<\/p>\n

Unpacking the Hackers’ Methods: How Do They Do It?<\/span><\/h2>\n

Decentralized finance<\/a> (DeFi) protocols were the primary targets of these hackers, accounting for over 80% of all cryptocurrency stolen last year.<\/p>\n

DeFi protocols replace traditional financial institutions with software that lets users transact directly with each other via blockchain<\/a>. These systems are vulnerable to hacks, as demonstrated by the numerous attacks on cross-chain bridge protocols<\/a>, these bridge services hold substantial reserves of different coins, making them enticing targets for hackers.<\/p>\n

Furthermore, some hackers have reportedly posed as workers from different nationalities to infiltrate these firms and funnel money back to their home countries.<\/p>\n

This highlights the hackers’ cunning and adaptability, demonstrating the lengths they are willing to go to attain their objectives.<\/p>\n

Counting the Spoils: How Much Are They Making?<\/span><\/h2>\n

Estimating how much these hackers make is challenging due to the lack of transparency and the highly technical nature of these thefts. However, we can still piece together some insights.<\/p>\n

In 2022, the top ten crypto hacks accounted for a staggering $2.375 billion<\/a>.<\/p>\n

The largest of these was the $612 million Ronin bridge hack. The infamous Lazarus Group, suspected to be backed by the North Korean state, was implicated in this attack, underlining the role of state-backed actors in large-scale crypto thefts.<\/p>\n

But it’s not just the scale of the hacks that’s worrying, it’s the regularity that is also concerning.<\/p>\n

\n

H1 2023 Web3 Security Statistics <\/p>\n

\ud83d\udea8Total losses from hacks, phishing scams, and rug pulls in Web3 reached $655.61 million in the first half of 2023. <\/p>\n

Among them,
108 attacks -> $471.43M
Phishing scams -> $108M
110 rug pulls -> $75.87M pic.twitter.com\/8Q9kmDETfQ<\/a><\/p>\n

— Beosin Alert (@BeosinAlert) June 30, 2023<\/a><\/p><\/blockquote>\n