Coinbase’s director of product strategy and business operations, Conor Grogan, revealed that billions of dollars worth of Ether had been permanently lost due to bugs and human errors. The director noted that mistakes and glitches were the cause of losing 636,000 ETH or $1.15 billion on the Ethereum blockchain.
Gone With No Recovery
According to the Coinbase director on Twitter, he has cataloged thousands of human mistakes and bugs on the Ethereum blockchain. Based on his findings, Grogan explained that 636,000 ETH, approximately $1.15 billion, was lost forever, representing 0.5% of the token’s circulating supply.
Moreover, nearly half of the total assets in circulation, 306,000 ETH, were due to the 2017 glitches that affected the Parity crypto wallet. In addition, Quadriga’s defunct crypto exchange reportedly lost 60,000 ETH to a buggy contract, with the Akutars NFT platform losing 11,500 ETH following a failed minting operation.
Apart from this, the Coinbase official disclosed that Ethereum users had sent 24,000 ETH to cold wallets, with no one among them able to access the coins. Based on his estimates, Grogan added that the $1 billion-plus is an understatement because the lost ETHs are locked forever.
Why Blockchain Hacks Persists
Attacks on crypto and blockchain platforms are not recent, and previous events have been full of never-ending drama. While millions of dollars worth of crypto assets has been stolen over the past few years, some hackers are kind enough to return all or part of their exploits.
However, blockchain security experts believe that some hacking incidents are inside jobs orchestrated by individuals who know how a particular crypto wallet operates. Meanwhile, the most surprising thing about the hacking incidents is that the Bitcoin blockchain has never been compromised.
The transparency behind the network’s security and the exceptional blockchain infrastructure helps keep it relatively safe from attackers. But that does not indicate that everything related to crypto is immune from a security breach.
According to industry experts, decentralized finance (DeFi) will remain vulnerable to hacking attacks from individuals or entities like the North Korean Lazarus Group, notorious for its many exploits within the crypto industry. Despite its lack of robust regulations, cryptocurrency is making inroads into the mainstream financial sector, even though many investors don’t have insurance for their deposits should their wallets be compromised.
Some hacks in the digital asset space include Compound Finance, the Ronin Bridge attack, and others. Going by the increasing attacks on wallets, experts advised that investors safeguard their assets on self-custody platforms, which provide more funds security than the ones offered by crypto exchanges.