As cryptocurrencies have become an integral part of the modern financial system — offering new opportunities for investment, settlement, and asset storage — the growing popularity of digital assets has also increased the risks associated with their loss. High-profile financial cases always attract attention, and traders must be aware of them to be prepared for unexpected events.
1. Mt. Gox exchange hack (2014)
Loss: 850,000 BTC (around $450 million at the time).
Mt. Gox, the world’s largest exchange at the time, suffered a massive attack due to security vulnerabilities allowing hackers to withdraw user funds.
Mt. Gox ultimately went bankrupt, leaving thousands of investors with significant losses. This case was a turning point for the industry, prompting exchanges to prioritize security measures.
Takeaway: Store cryptocurrencies on hardware wallets, not exchanges, use two-factor authentication (2FA) and update passwords regularly.
2. Coincheck exchange hack (2018)
Loss: 523 million NEM tokens (around $530 million at the time).
Hackers accessed Coincheck’s hot wallet, storing funds for operational transactions.
While the exchange reimbursed users for their losses, its reputation took a major hit.
Takeaway: Opt for exchanges that store most of the funds in cold wallets and have insurance protection.
3. Parity Wallet private key leak (2017)
Loss: 150,000 ETH (around $30 million at the time).
An error in the Parity wallet’s smart contract blocked user funds, allowing attackers to exploit the vulnerability and withdraw some of the funds.
This incident divided the Ethereum community — some supported the hard fork to recover the funds, while others advocated maintaining the blockchain’s immutability. Given Ethereum current price fluctuations, security remains a top concern for investors.
Takeaway: Always research smart contracts and wallets before use, and choose well-established solutions.
4. Lost Bitcoin wallet password (2021)
Loss: 7,002 BTC (around $220 million at the time).
German programmer Stefan Thomas lost access to his wallet after forgetting the password to IronKey, where his private keys were stored.
The funds remained permanently blocked, underscoring the importance of responsible data storage.
Takeaway: always write down and securely store your passwords. Use hardware wallets with backups.
5. Poly Network DeFi fraud (2021)
Loss: around $610 million in various tokens.
Hackers exploited a vulnerability in Poly Network’s code to withdraw funds.
Surprisingly, after negotiations with the project team, the attackers returned most of the funds. However, this incident significantly damaged trust in DeFi projects.
Takeaway: While DeFi projects offer high-profit potential, always review smart contract audits and research the developers’ reputations.
The loss of cryptocurrencies is a serious issue affecting both beginners and experienced users. However, following basic security practicies — such as using hardware wallets, enabling two-factor authentication, and thoroughly vetting projects before investing — significantly reduces risks. In the world of cryptocurrencies, securing your funds is ultimately your responsibility.
Disclaimer: The views expressed in this article are those of the author and may not reflect the views of the CryptoTotem team. This article is for informational purposes only and is not intended to be used as legal, tax, investment or financial advice. The author or the publication does not hold any responsibility, directly, or indirectly, for any damage or loss caused or alleged to be caused by or connected with the use of or reliance on any content, goods or services mentioned in this article. Readers should do their own research before taking any action on this matter.