- Crypto exchanges, wallets, and blockchain bridges are investing a fortune to protect their sites from these hackers, including hacks sent by North Korea.
The tragedy of some has been the blessing of others in the crypto space this year. The increase in cybercrime related to the cryptocurrency industry has fueled the work of firms dedicated to evaluating and ensuring the security of companies that trade in crypto.
Attacks sponsored by North Korea’s hacker army and other criminals against Western cryptocurrency platforms have led to a substantial increase in demand for cybersecurity.
Companies that are dedicated to evaluating the weaknesses of crypto platforms and providing cybersecurity have had a lot of work these days. The volume of their business has grown exponentially. While other companies are laying off staff, security firms are hiring hundreds of technicians.
Increase in service fees
This has caused wages to rise, service fees to rise, and revenues for cybersecurity companies to rise like never before. A cybersecurity auditor can earn up to $400,000 a year. Company balance sheets show how fear of sophisticated hackers is driving this sector.
From January to July, cybercriminals have stolen from decentralized finance (DeFi) companies, dedicated to trading and lending cryptocurrencies, about 2 billion dollars in digital currencies, according to data from Chainalysis.
Despite the decline in trading of cryptocurrencies and other digital assets due to the collapse in prices, the volume of thefts has not fallen. As a result, crypto security services are becoming “must-have” expenses, regardless of their size.
CEO of crypto firm Morpho Labs Paul Frambot revealed to Bloomberg an unprecedented increase in spending on security audits. “Security is, in my opinion, not taken sufficiently seriously in DeFi,” he added. Morpho has done more than 10 code audits in the last year, according to Frambot. These audits consist of expert reviews of the code, who identify bugs and other security issues to prevent hackers from breaching them.
In the last year alone, this company dedicated to cryptocurrency loans has contracted a dozen code audits, Frambot revealed.
On the Flipside
- The cybersecurity business has also not gone unnoticed by investors who are looking for a new niche to invest in.
So far this year, venture capital funds have invested $257 million in security and crypto audit companies. Last year the investment was USD 185 million, according to data compiled by CB Insights.
Why You Should Care
- Ever since the cryptocurrency industry took off, cybercriminals have been on the prowl. The failures of the protocols and the errors of the companies themselves have exposed their vulnerability.
With so much money at stake, hackers perfect their exploit tactics every day to commit their misdeeds. Fundamentally the cryptographic bridges have become the main targets of attacks.
“These protocols are not simply another service that may be disrupted for a while — for example, like not being able to watch TV for a few hours or longer,” said investor in cybersecurity firms Stefano Schiavi. A failure of any of these protocols means that “many people lose significant portions of their savings, and often they even lose everything,” added the investor.
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