A whopping $1.7 billion in cryptocurrency vanished in 2024, mostly because hackers stole private keys, according to a new report from cybersecurity firm Hacken. This makes private key theft the biggest threat facing crypto investors.
Private Keys: The Weak Link
Hacken’s 2024 Web3 Security Report shows that private key theft dwarfed other types of crypto hacks. Access control exploits, which are largely linked to stolen private keys, accounted for nearly 75% of all crypto losses in 2024 – a huge jump from 50% in 2023. Smart contract vulnerabilities only accounted for 14% of losses.
Private keys are essentially secret codes that unlock your crypto. Losing them means losing your crypto.
How Private Keys Get Stolen
Hacken points to four main ways people lose their private keys:
- Insecure management platforms: Storing your keys on a poorly secured platform is a recipe for disaster.
- Social engineering: Scammers trick you into giving up your keys.
- Insecure backups: Poorly protected backups can be easily accessed.
- Wallet vulnerabilities: Some wallets have weaknesses that can be exploited.
WazirX Hack: A Prime Example
The biggest crypto heist of 2024 involved the Indian exchange WazirX, where over $230 million was stolen. Even though WazirX used a multi-signature system (requiring multiple approvals for transactions), hackers cleverly manipulated the system to get the necessary approvals and drain the funds.
The Bottom Line
Losing your private keys is a major risk in the crypto world. Be extra careful about how you store and manage them. This isn’t investment advice; always do your own research before investing in crypto.
