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Bitcoin theft down to Near to 0 in 2020

A recent report on the amount of bitcoin stolen through a variety of scams over the years has confirmed that theft of this digital asset is down significantly across the board, suggesting that security around the highest-performing cryptocurrency has tightened significantly. Jameson Lopp, the chief technology officer and cofounder of digital asset custody company Casa, released an aggregated tranche of data on bitcoin theft, accumulating statistics from 2011 through 2020. This collection shows that, per available data, bitcoin theft in 2020 was down 92 percent compared to theft in 2019, based on the volume of BTC stolen. As a percentage of the total bitcoin supply, 2020 saw just 0.002 percent of coins stolen, compared to just below 5 percent in 2014, for instance.

2014 was by far the most lucrative year for bitcoin thievery, with the vast majority of that year’s total coming from the major heist on Mt. Gox, one of the earliest prominent cryptocurrency exchanges. Since then, the overall trend has been toward less theft in the space, save for 2016’s major Bitfinex hack and a Ponzi scam targeting Chinese Bitcoiners that took place in 2019. 2020’s cumulative losses much smaller than those in either of these individual scams. Lopp also took to Twitter to answer questions about the methodology of this study, claiming that he only counted instances of coins being lifted from wallets, as instances of private key theft “tend to be small scale and [to] not get news coverage.” Holes like this in Lopp’s data aggregation might reflect the notion that a large portion of Bitcoin thieves have simply developed more sophisticated and invisible tactics. For example, in addition to a variety of scams that target private keys and other such small-scale enterprises, a report in the first days of 2021 claimed that one group of organized criminals carried out $150 million in ransomware attacks over the last several years. Attacks like these may be considered to be a form of digital extortion, rather than a “hack” as one might classically define it; in essence, a piece of malware bricks some piece of internet-connected equipment until the victim pays bitcoin to a certain address, typically listed on the device’s error message. The report claims that this technique has grown immensely since it first appeared on the scene, and a popular target for ransomware attacks during the global pandemic has been hospital equipment. Still, although nefarious “innovators” like these criminals have uncovered ways to use bitcoin to carry out age-old methods of extortion, the fact remains that the theft of bitcoin from unsuspecting wallets has almost completely disappeared. This is probably because the most commonly-trafficked points of contact in the cryptocurrency economy, from exchanges to any number of services, now have a standard of security that is much higher than in previous years. For more information follow us on IG and twitter: @ycobitcoin - and read our weekly blogs.


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