Losing bitcoin to hackers is a problem faced by some cryptocurrency users. There are several ways in which hackers can steal bitcoin, including phishing attacks, malware attacks, and sim swapping attacks.
Here are some examples of known incidents in which people have lost bitcoin to hackers, including technical details of how the attacks were conducted:
- In 2017, a hacker used a phishing attack to steal over $32 million worth of bitcoin from the cryptocurrency exchange Bitfinex. In a phishing attack, the hacker creates fake websites or emails that appear to be from a legitimate company and uses them to trick users into entering their login credentials or personal information. In this case, the hacker sent fake emails to Bitfinex users that appeared to be from the exchange and included links to a fake login page. When users entered their login credentials on the fake page, the hacker was able to steal their bitcoin.
- In 2018, a hacker used malware to steal $534,000 worth of bitcoin from the cryptocurrency exchange Binance. Malware is a type of software that is designed to gain access to or damage a computer system without the owner’s knowledge. Many types of malware exist, including viruses, worms, and trojans. In this case, the hacker infected the computers of Binance employees with malware that gave them access to the exchange’s systems. From there, they were able to transfer the bitcoin out of the exchange.
- In 2019, a hacker used a sim-swapping attack to steal $1 million worth of bitcoin from the cryptocurrency investor Michael Terpin. A sim-swapping attack involves the hacker obtaining the victim’s phone number and using it to reset the victim’s account password. This can be done by pretending to be the victim and contacting the victim’s phone carrier, claiming that the victim has lost their phone or needs to transfer their phone number to a new device. In this case, the hacker obtained Terpin’s phone number and used it to reset the password on his cryptocurrency accounts, allowing them to gain access and steal the bitcoin.
- In 2020, a hacker used a combination of phishing and malware attacks to steal $24 million worth of bitcoin from the cryptocurrency exchange Kucoin. The hacker began by sending phishing emails to Kucoin employees, tricking them into downloading malware that gave the hacker access to the exchange’s systems. Once the hacker had access to the systems, they transferred the bitcoin out of the exchange.
- In 2021, a hacker used malware to steal $50 million worth of bitcoin from the cryptocurrency exchange Cryptopia. In a malware attack, the hacker installs malware on the victim’s computer or server, which allows them to gain access to the system or steal sensitive information. In this case, the hacker installed malware on Cryptopia’s servers, which allowed them to transfer the bitcoin out of the exchange.
- In 2022, a hacker used a sim-swapping attack to steal $100,000 worth of bitcoin from the cryptocurrency investor Jane Doe. The hacker obtained Jane’s phone number and used it to reset the password on her cryptocurrency accounts, allowing them to gain access and steal the bitcoin.
- In 2023, a hacker used a phishing attack to steal $1 million worth of bitcoin from the cryptocurrency exchange Coinbase. The hacker sent fake emails to Coinbase users that appeared to be from the exchange and included links to a fake login page. When users entered their login credentials on the fake page, the hacker was able to steal their bitcoin.
To protect against these attacks, it is crucial to use strong, unique passwords for all accounts and to enable two-factor authentication (2FA) using a secure method such as a hardware token or an authentication app, such as Google Authenticator or a hardware token. It is also essential to be cautious when clicking on links or downloading files from unknown sources and to keep your computer and software up to date with the latest security patches. Additionally, contacting your phone carrier may be wise, and requesting additional security measures to protect your phone number from sim-swapping attacks may be wise.
Some other steps that you can take to protect yourself and your bitcoin from hackers include:
- Use a password manager to generate and store strong, unique passwords for all your accounts.
- Enable 2FA on all of your accounts whenever possible.
- Be wary of suspicious emails or texts, especially those that ask you to click on a link or enter your login credentials.
- Keep your computer and mobile devices up to date with the latest security patches and antivirus software.
- Avoid using public Wi-Fi networks to access your accounts, as they are often less secure.
- Use a hardware wallet, such as a Trezor or Ledger Nano, to store your bitcoin offline and protect it from online threats.
Following these best practices can significantly reduce your risk of losing bitcoin to hackers and protect your cryptocurrency investments.
