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Crypto Hacks Plunge 70% in Q1 2023, Victims Recover Over Half of Stolen Funds, but Experts Warn of Temporary Relief

Crypto Hacks Plunge 70% in Q1 2023, Victims Recover Over Half of Stolen Funds, but Experts Warn of Temporary Relief

On May 22, 2023, a report released by the blockchain analysis firm TRM Labs delved into nearly 40 hacks and assaults on cryptocurrency projects within the first quarter, discovering a 70% decline in incidents over the previous three months. The study says the slowdown is probably temporary, with over half of the purloined funds being reclaimed by hacking victims in Q1 2023.

Crypto Crime Cools: Hacks and Attacks Plummet 70% in Q1 2023

TRM Labs approximates that close to $400 million was pilfered in Q1 2023 from almost 40 separate crypto infiltrations and attacks. This statistic has plunged by around 70% compared to Q1 2022, as per the findings of the blockchain analytics firm. Moreover, this year’s first quarter recorded lower figures than any quarter of 2022 since the typical hack amounted to $10.5 million.

In contrast, the mean hack value during Q1 2022 reached over $30 million, experiencing a comparable count of nearly 40 incidents. A notable disparity between this year’s and last year’s breaches is the substantial amount of recoveries. “To date, hacking victims have recovered over half of all stolen funds in Q1 2023,” stated TRM Labs in its recent analysis.

TRM Labs investigators clarify that there is no “obvious explanation for the lull,” but cybercriminals might have been discouraged by two particular events. The first entails the U.S. government’s allegations toward Avraham Eisenberg in connection with the Mango Markets occurrence last year. The second possible cause for the hiatus mentioned by researchers was the sanctions imposed on ethereum (ETH) mixer Tornado Cash as a result of last year’s U.S. Treasury actions.

The report from TRM Labs highlights that blockchain monitoring tools have advanced and virtual asset service providers (VASPs) have elevated their anti-money laundering (AML) criteria. These elements could have contributed to Q1’s deceleration, but experts do not foresee its continuation. “Unfortunately, this slowdown is most likely a temporary reprieve rather than a long-term trend,” the blockchain intelligence company’s Q1 2023 examination concludes.

Is the recent decline in crypto hacks a sign of a turning tide in cybersecurity or merely a temporary respite before the storm? Share your opinions and insights in the comments section below.

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