It’s every cryptocurrency project’s nightmare: Well-resourced hackers — perhaps backed by a rogue state like North Korea — strike out of nowhere, dismantling cyberdefenses and making off with millions of dollars in customer funds.
Many crypto outfits, large and small, have suffered permanent damage this way. Yet across the industry, startups strapped for cash after a prolonged funding drought have cut security spending even as soaring digital-asset prices tempt hackers, according to firms that sift through code for weaknesses.
That leaves the cryptosphere vulnerable as the number of exploits targeting the industry skyrockets, undermining efforts to establish it as a viable alternative to traditional finance. In particular, hackers linked to North Korea, among the most sophisticated in the business, are showing no signs of letting up.