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Tencent’s Report: Blockchain Security Vulnerabilities Have Caused A Loss of Over $2.7 Billion In First Half of 2018

To date, there are over 1,600 cryptocurrencies listed on coinmarketcap.com, with a combined total market cap of $250 billion. As the blockchain hype train has been operating at full steam, blockchain security issues have led to an economic loss of over $2.7 billion in the first half of 2018, according to the Tencent’s security arm.

Blockchain Security Report for the First Half of 2018’, jointly released by Tencent United Security Lab and China-based security company Knownsec, noted that among over 1,600 crytocurrencies, there are a large number of “air coins” , a term refers to token projects that are not backed by legally registered business entities, which are considered worthless. However, they drive the crypto market capitalization to up to over $600 billion during the peak period.

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The report conceded that blockchain security issues, including cryptojacks, crypto thefts, smart contract problems, become increasingly prominent following the blockchain and crypto hype in the first half of 2018, and cryptocurrency-induced social security issues also plague the industry.

“The economic losses caused by blockchain networks’ own vulnerabilities, blockchain ecosystems’ security issues and crypto holders’ improper operation in the first half of this year are $1.25 billion, $1.42 billion and $56 million, respectively, totaling 2.7 billion US dollars,” the report said.

In addition, cybercriminals have stolen nearly $7 million from cryptocurrency exchanges during the period. The report suggested that there are four popular ways to steal cryptocurrencies: attacking both users and crypto exchanges, ‘double-spend’ attacks, and exploiting blockchain networks’ loopholes.

Meanwhile, Cybersecurity company Carbon Black also found that roughly $1.1 billion worth of cryptocurrency was stolen in the first half of 2018, and exchanges were the most popular target for cybercriminals, making up 27 percent of attacks this year. The significant amounts of already stolen funds signals that the crypto industry is not ready to defend itself and protect its users, according to CNBC.

Tencent’s report advised crypto investors to increase knowledge of phishing attacks and to avoid visiting illegal websites and clicking on links.They also advised using antivirus software to reduce the chances of falling victims to phishing attacks and crypto thefts. For blockchain-involved companies, the report recommended that such enterprises should cooperate with professional blockchain security research bodies to detect and fix system vulnerabilities, so as to shun the large-scale crypto thefts.

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