Your Crypto Winter = Criminals’ Summer: Q1 2019 Crypto Thefts, Fraud Hit Whopping $1.2 Billion

Even as the bearish conditions in the crypto markets persisted in this year’s first quarter, bad actors in the sector continued to thrive. According to cybersecurity firm CipherTrace, during the first quarter of the year, the amount that bad actors generated from stealing from bitcoin exchanges and operating cryptocurrrency scams reached $1.2 billion in this year’s first quarter, as initially reported by Reuters.

Misappropriation of funds or fraud took the crown as losses from this category reached $851 million. Losses from scams and thefts from crypto exchanges, on the other hand, amounted to $356 million.

With the entire 2018 having registered losses of $1.7 billion from cryptocurrency thefts and scams, this year is set for a record if the current pace continues. Per the CEO of CipherTrace, Dave Jevans, the weak enforcement of regulations has contributed to this state of affairs. Jevans also blamed moral and ethical failings as well as mismanagement for some of the losses:

This year one of the most publicized losses from a cryptocurrency exchange was that of Canada’s QuadrigaCX. About $134 million of user funds cannot be accessed as they are locked in a cold wallet set up by the firm’s deceased CEO. While it is not the usual hacking of an exchange, it doesn’t matter for the users as they still can’t access their crypto assets.

Despite the strangeness of the whole saga, the QuadrigaCX incident still pales in comparison to the first quarter of 2018. Then more than half a billion worth of cryptocurrencies had been stolen by the close of Q1. This was largely stemming from the hacking of one exchange – Japan-based Coincheck.