Crypto theft is booming as criminals increasingly turn to physical attacks

CNBC

5 days ago

The value of cryptocurrencies stolen by criminals surged in the first six months of 2025 after a high-profile hack and a wave of physical attacks targeting crypto holders and their relatives.
So far this year, $2.17 billion has been stolen from crypto services — already eclipsing the $1.87 billion of funds stolen from platforms in 2024 — and this is expected to reach $4 billion by the end of 2025, according to a report published Thursday by blockchain analysis firm Chainalysis.
Overall, the combined value of digital tokens stolen from both crypto platforms and individuals hit more than $2.8 billion and is already approaching the $3.4 billion in crypto stolen last year.
The bulk of the funds stolen from services came from February's cyberattack on Dubai crypto exchange Bybit, which saw North Korea-linked hackers make off with $1.5 billion. It's estimated to be the largest crypto heist in history.
However, the rise in stolen crypto assets was also driven by a spike in attacks on individual crypto wallets. Personal wallets accounted for over 23% of total thefts, with attackers increasingly turning to physical violence and coercion to access funds, Chainalysis said.
In January, David Balland, a co-founder of crypto wallet firm Ledger, was kidnapped with his wife from their home in central France. Before they were freed, the attackers cut off Balland's finger and sent footage of it to his fellow co-founder Eric Larcheveque demanding ransom money.
Separately, in May, the father of a crypto entrepreneur was taken in broad daylight by four men wearing ski masks. The kidnappers demanded a ransom of several million euros and cut off one of the man's fingers. He was freed by police days later.
Eric Jardine, cybercrimes research lead at Chainalysis, told CNBC that the rise in crypto-related thefts was primarily being driven by increasing crypto adoption and price appreciation.
"Adoption means there are more services and users in the crypto ecosystem, making thefts more common. Price appreciation means that services and individuals in crypto have more USD value to lose, even if the total assets stolen are relatively constant over time," Jardine said via email.
Jardine suggested that the uptick in attacks on individual crypto holders could relate to the fact that crypto trading services are beefing up their security.
"If services become better at security, malicious actors will potentially move to targeting individual wallet holders and trade off a single large-scale heist in favor of a large number of smaller-scale victimizations," he said.
Meanwhile, rising wealth accumulated through holdings of cryptocurrencies like bitcoin has resulted in a rise in crypto influencers flaunting their lifestyle on social media platforms.
Jardine stressed it was important not to blame the victims of physical crypto-related attacks, adding that "showy displays of wealth can quite obviously attract the attention of a bad actor when compared to a more modest outward facing lifestyle."