'Crowd looting' and market manipulation contributed to 47% of $2.8 billion worth of hacks in 2022

The crypto market has evolved from Initial Coin Offerings (ICOs) and Dapp creators stealing their users' funds and disappearing. The growing participation of experts and the increase in attention has led to other methods causing far more damage, including a diverse range of exploits.

The crypto market is haunted by this hacking method

According to a CoinGecko analysis, 2022 faced a host of attacks with hackers deploying various techniques to execute their attacks. While not one reason singlehandedly caused significant damage, a diverse range of methods led to nearly $1.3 billion worth of crypto assets being stolen last year.

Diverse Methods included the likes of 'crowd looting', bypassing verification processes, manipulating the market and taking advantage of smart contract loopholes.

These methods were also responsible for some of the biggest hacks of the year, including the Wormhole hack worth $326 million caused by bypassing verification processes. The Mango Market hack of October 2022, which led to $116 million being stolen from the treasury, was caused by market manipulation.

However, the biggest attack of the year was caused by another leading cause of hacks - Access Control. The Ronin Bridge exploit, which led to the theft of nearly $625 million, was alone responsible for 58% of access control hacks last year.

This method of exploiting also led to $1.07 billion worth of crypto assets being stolen in the span of 12 months. While 2022 noted a total of $2.8 billion in hacks and exploits, 47% of these were caused by diverse methods, while another 38% were caused by access control hacks.

Various methods of crypto attacks in 2022

In addition to this, Flash Loan attacks, reentrancy attacks and oracle issues also caused damage to users last year. The least impacting method turned out to be phishing, and the reason behind this is the growing awareness pertaining to cryptocurrencies in the industry. In all, phishing attacks only led to the theft of $17.8 million worth of digital asset funds.

US authorities take action

Since the crypto market is still in its infancy, it is taking some time for the regulators to come up with methods to deal with such problems. However, the authorities are doing their best to minimize the damage.

As reported by FXStreet last month, The Department of Justice managed to penetrate the network of the ransomware group "Hive".

Doing so led the DoJ to produce nearly 1300 decryption keys for Hive's victims. The keys were offered back to the victims around the world and prevented the group from stealing about $130 million in ransom. The DoJ, in their press conference, stated,

"We will continue to work both to prevent these attacks and to provide support to victims who have been targeted. And together with our international partners, we will continue to disrupt the criminal networks that deploy these attacks."