The blockchain industry has lost a whopping $30-billion to hacking incidents since 2012 – and 36% ($10,95-billion) of these losses occurred through exchange hacks, says a BanklessTimes report.
This growing menace raises concerns about the vulnerability of exchanges and the urgency to bolster their security measures.
According to BanklessTimes Editor and cryptocurrency expert Alice Leetham, several factors make exchanges alluring hacking targets. But the most prominent factor is the centralised nature of many exchanges which necessitates users to trust a single entity to safeguard their funds.
This concentration of assets makes exchanges more appealing to hackers, who can gain control over a significant amount of cryptocurrencies in one fell swoop.
“Exchanges are attractive targets because they act as centralised repositories of users’ funds,” says Leetham. “Hackers see them as high-value targets where a successful breach can yield substantial profits.
“It’s crucial for exchanges to prioritise security measures to protect user funds,” adds Leetham.