As companies continue to fall prey to attacks and exploits, professionals working in the cybersecurity space contributed to what can be improved in terms of crypto security for digital asset companies and the crypto industry at large.
Before September, almost $1 billion had already been lost due to cryptocurrency hacks, exploits, and scams in 2023. However, more incidents continue to rock the cryptocurrency world in Q4 2023, such as the Poloniex exploit, with more than 100 million dollars in digital assets. losses and the HECO chain bridge hack, with more than 80 million dollars in losses.
.@Poloniex is suspected to have been hacked.
Poloniex address ‘0xA910’ transferred all tokens to a new address ‘0x0A59’ within 40 minutes, with a total value of about $60 million.
‘0x0A59’ is currently transferring funds to more addresses and converting them to $ETH: pic.twitter.com/Kjdw5gIkxa
– Scopescan (@0xScopescan) November 10, 2023
With the number of security incidents occurring within the space and the value lost for each hack or exploit, it is undeniable that there are gaps to fill in terms of digital asset security within the crypto space. Because of this, Cointelegraph reached out to cybersecurity professionals to see what they think can be done to prevent further incidents and strengthen security in cryptocurrencies.
Continuous incidents are “unforgivable”
Ronghui Gu, co-founder of blockchain security firm CertiK, told Cointelegraph in a statement that it is “inexcusable” that incidents caused by SIM swapping and multi-signature flaws continue after the incidents brought visibility to this security issue. . According to Gu, companies should adopt cryptographic multi-factor authentication and conduct regular security audits. He said:
“We’re building highly functional, highly complicated technology, and it’s important to make safety the primary consideration, even when there are often big incentives to build fast and break things.”
Christian Seifert, resident researcher at Forta Network, also agreed that security should be a priority. Seifert, who previously worked as a security leader at Microsoft, said users must demand security and, if this does not happen, regulators must intervene. The security professional said that in this way, crypto projects would adopt more comprehensive security. strategies.
Additionally, Seifert also argued that while security audits are effective, “they are not enough.” “A comprehensive security strategy is needed that starts with secure design and extends to threat monitoring and prevention solutions,” she added.
Jerry Peng, a research analyst at Web3 analytics firm 0xScope, told Cointelegraph in a statement that there is a need to better understand where and how security threats can potentially arise. In this way, companies and individuals can detect patterns and connections shown by addresses involved in previous attacks. “This is where cryptographic data analysis services can help researchers thwart the next potential attack,” Peng explained.
Related: Cybersecurity team says up to $2.1 billion worth of cryptocurrencies stored in old wallets are at risk
How hacks hinder cryptocurrency adoption
Gu told Cointelegraph that, according to data compiled by CertiK, hacks in 2023 alone have already cost the space $1.5 billion as of November 28. The executive believes that these incidents that continue to plague the space also have a massive effect on the adoption of cryptocurrencies. “These hacks and exploits significantly impact cryptocurrency adoption by undermining public trust in the security and stability of digital assets,” Gu added.
Seifert also expressed similar sentiments. The security researcher noted that while early adopters of the technology accept that there are risks, this will no longer be acceptable to the broader user base that the crypto space is trying to attract. Seifert explained:
“Imagine losing all your savings because your bank branch was robbed overnight. You wouldn’t bank there.”
Peng also believes that hacks stifle the potential growth of the market. According to Peng, these can “scare” people who were previously open to exploring the Web3 space.
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