Since the inception of crypto, the question of hacking has been a top-burner question with a lot of questions as to how the crypto wallet works and if it is hackable.
In this article, we will look at some of the recent hacks, and how they were done and then try to replicate some of the acts.
First, what is a Crypto wallet?
A crypto wallet like a regular wallet stores the user’s public and private keys to your digital currency called cryptocurrency.
A wallet can be either physical or stored on platforms.
How Does Crypto Wallet Interact?
All crypto wallets are connected to blockchain technology and must have a public key and private key which allows the wallet to send and receive crypto while also storing your transactions on the blockchain.
Buying crypto online or trading, most online platforms, like Binance, Coinbase, and many others will give you an online wallet which is called a hot wallet as it is connected to the internet and highly prone to hackers.
It is advisable to get a code wallet/drives that are not connected to the internet and transfer your crypto coins to such as ……
Wallet Hacks
Poly Network is a crypto platform and exchanger Network which experience a major hack in 2021 where the hacker stole over $600 million worth of tokens.
Poly network promised the hacker a $500,000 bounty fee and a job as the chief security officer but the hacker returned more than $400 million worth of tokens and held back the rest.
Binance the biggest by volume platform was hit in 2019 where over 7000 bitcoin were stolen by one account, the hacker was able to break into the exchange security system and obtain secured APIs and two-factor authentication codes which allowed the hacker to move an approximately $40 million worth of bitcoin.
In September 2020, was hit by a major hack as over $275 million worth of tokens was stolen by hackers using and Kyber to move tokens, although the suspect was found the whole coin was never recovered.
The biggest of 2022 was a decentralized, universal message-passing protocol that connects multiple chains while being watched by guardians which validate transactions.
Wormhole was hit by a $320 million hack after a hacker targeted the bridge of exchange between Ethereum and Solana
The hacker was promised a $10 million bounty by the Wormhole team for returning the funds but the hacker never did and this lead to the hedge fund backing wormhole in returning the funds.
How Does A Wallet Hack Happen?
Phishing Attacks: This is one of the common ways hackers get into your wallet and steal your tokens, hackers utilize cloned websites of legitimate platforms, and this identical platform almost indistinguishable from the original can be easily passed as the original and unsuspecting victims might log in with their details and their tokens stolen.
How to Avoid this Hack: to avoid phishing attacks, avoid clicking on links you have no idea about, and do not log in your details on any platform unless it is verified.
Fake Hardware Wallet: This is a targeted hack where a hardware wallet owner is targeted and sent a modified hardware wallet with instructions that the previous hardware is vulnerable and must be changed immediately.
The unsuspecting victims are asked to change log in their password and key phrase which is key-logged and sent to the hackers who use them on the blockchain.
How to Avoid this Hack: Never accept a secondary hardware token from anyone, and contact your vendor of the initial hardware to confirm, also do not use the hardware in any of your systems as they might introduce malware to your infrastructure.
Malware: Hackers have been able to modify the malware hacking scheme into a more advanced virus program that is able to detect addresses and redirect users to websites that are filled with malware, upon accessing the website, user systems are laden with worms or trojans that searches for key phrase and addresses of victims.
How to avoid this Hack: Never use a redirect website for any crypto-based transactions as the transactions can not be undone when done.
Cross-check the addresses on the blockchain ledger if you need better clarification on certain addresses and use BitcoinAbuse to confirm if an address has been flagged.
Can A Wallet be Hacked?
Yes, Wallets are hacked every day but they can be avoided if high-level security structures are put in place and consistently updated.
Conclusion
Crypto is still a delicate platform as the high-security breach leads to fear for so many but the upside of this platform outweigh the downside and while we might never get to the total eradication of hacks as new updates come in, we must always keep a watchful eye and try to protect our wallet as best as we can.
To learn more about Blockchain, here are some updated articles that can get you started.
