Chainalysis: the damage from hacking of cross-chain protocols amounted to $2 billion since the beginning of the year

Experts called the vulnerability of bridges the main threat to the security and trust of users in blockchain technology

04.08.2022 - 11:10

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What’s new? According to analytics company Chainalysis, there have been 13 attacks on cross-chain protocols since the beginning of the year, with a total of $2 billion stolen by hackers. These hacks accounted for 69% of all exploits in 2022. In their calculations, the experts took into account the August 2 attack, which stripped the Nomad protocol of virtually all of its funds. In their study, they noted that the vulnerabilities of bridges between networks are becoming the main threat to security as well as to users’ trust in blockchain technology.

Information on the Chainalysis blog

What does the report say? Analysts noted that bridges are becoming increasingly attractive to hackers as the volume of assets flowing through them grows. Thus, Chainalysis reported that bridges are a prime target for hackers associated with the DPRK, who have stolen $1 billion worth of cryptocurrency from cross-chain and other DeFi protocols this year alone.

Typically, to move assets between networks, users send funds to the cross-chain protocol, after which they are locked into a contract as collateral. Users are then given the equivalent of the asset in another network to which the protocol is connected. According to analysts, bridges attract hackers because they often have a central storage point for funds locked as collateral.

In 2022, the biggest was the attack on the Ronin sidechain, with hackers withdrawing $625 million in digital assets. Analysts believe that cryptocurrency services need to start investing in security upgrades and training. Rigorous code audits will also help eliminate the problem of attacks on cross-chain protocols.

In June, Chainalysis launched a 24/7 hotline for companies affected by fraudsters, hackers, and cyberattacks. Victims of cryptocurrency-related crimes can get help and support in recovering their lost funds.

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