API Keys Lead to Millions Lost in Cryptocurrencies

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API Keys Lead to Millions Lost in Cryptocurrencies

With cryptocurrencies gaining popularity and continuous media coverage, it’s tempting to get caught up in this innovative yet widely misunderstood asset. Investing money in cryptocurrency though highly lucrative, can be monetarily devastating for individuals who do not protect their assets from the dangers of digital currency with the help of skilled crypto cybersecurity services. Stolen API Keys can cause huge financial losses as hackers target cryptocurrencies.

As the demand for cryptocurrency rises, the risk of cybercrime increases too. It is expected that cryptocurrencies will transform the future of global finance, altering how we secure our assets in the future. 

Let’s look at recent news where cybercriminals used leaked API keys to steal millions of dollars from cryptocurrency exchanges.

So What Exactly Happened?

Researchers from CyberNews discovered that hackers could utilize cryptocurrency exchange API keys to steal currencies from their victims’ accounts without having any withdrawal permissions. More than $1,000,000 in cryptocurrency is kept in accounts with API keys accessible on public code repositories.

It was discovered that cybercriminals may not even need to install any malware or spyware on the user’s device to steal API; instead, they examine publicly available web app environment documents and public code sources for leaked secret keys in an attempt to gain access. Researchers found several trade offers for stolen crypto exchange API keys on hacking websites.

API Keys And Cryptocurrency

How did API hacking begin? Companies started to offer applications and services to assist traders in expediting their trading process. To utilize these services, traders authorize third-party applications to access their cryptocurrency exchange accounts via API keys. These apps can use the API keys to do activities on the trader’s behalf, including opening and executing automated trading orders without logging into the exchange.

Commonly, cryptocurrency exchanges provide traders with three sorts of API permissions:

  1. Data authorization allows APIs access to your exchange account details, like current orders, balances, and past transactions, without making any alterations to your account.
  2. Trade authorizations enable APIs to make trades, place open orders on your behalf, and close orders.
  3. APIs with withdrawal authorization can withdraw cryptocurrency from your exchange account and move them to another place. With this access enabled, an app might move your money from one wallet to another without your knowledge.

How Cybercriminals Exploit API?

API keys are used to give third-party programs transaction access. Cybercriminals use the stolen API keys to hijack or empty victims’ accounts on practically all prominent exchanges. Even without the traders’ account withdrawal permission or passwords, attackers may override trade-only limitations on API keys and steal assets from user accounts.

To take advantage of stolen API keys, cybercriminals trade on behalf of their victims, making extremely unfavorable deals against bots that they have deployed. So, never underestimate cybercriminals. If there’s money to be earned, they’ll find a method to get it. So always be careful!

What To Do?

We learned a few lessons to protect our cryptocurrencies from this incident, 

  • Avoid API keys that are static and have a long lifespan.
  • Many cryptocurrency exchanges enable whitelisting of API key IP addresses. As long as cybercriminals don’t have access to your trading bot control panel, using this function will deter most hackers from trading away your money.
  • Avoid retaining or revealing your API keys on a hard drive or disclosing them to anybody to keep your cryptocurrency safe. 
  • By rotating your API keys and passwords, you can secure yourself from cybercriminals who leverage old data files to access your exchange account.
  • Get help from cybersecurity professionals to secure your cryptocurrency!

Rogue Logics provides in-depth security services for the assessment and protection of your application, data, and infrastructure against potential threats on-prem or in the cloud. 

Want a consultation with the professionals at Rogue Logics, contact us and get a free quote.