The crypto industry has lost $26.9 billion to hacking attacks since 2017 while earning $47 billion in on-chain revenue, representing a loss of 57 cents for every dollar generated, according to research from ARK Invest.
Lorenzo Valente, director of research at ARK Invest, analyzed data from Token Terminal covering 27 major crypto projects alongside hack losses tracked by DefiLlama. The comparison revealed that security remains a significant weakness for the industry.
Revenue Outpaced Losses Until 2026
From 2021 through 2025, on-chain revenue generally exceeded theft losses. In 2021, the sector generated $12.5 billion in revenue while losing $2.9 billion to hackers. By 2024, revenue reached approximately $9 billion against $1.7 billion in losses.
However, the trend reversed in 2026. The industry has generated approximately $5.6 billion in on-chain revenue year-to-date while losing $8.7 billion to theft, marking the first year since 2020 when losses exceeded earnings.
Binance Breach Drives 2026 Losses
The $6.3 billion stolen from Binance in late October accounts for the bulk of 2026 losses. According to Binance co-CEO Richard Teng, the attack involved a compromised DevOps engineer's laptop used to reach a service container and submit unauthorized withdrawals, with multiple breach points identified.
The FBI and blockchain security firms attributed the attack to TraderTraitor, a group allegedly linked to North Korea. North Korea denied involvement and accused the United States of political provocation.
Freeze and Recovery
Blockchain partners including Tether and Circle managed to freeze approximately $3 billion of the stolen funds on-chain, primarily in stablecoins. Binance committed to compensating affected users through its SAFU funds, corporate treasury, and related reserves. The exchange resumed withdrawals in phases beginning November 1 after temporarily halting them.
Valente concluded that security remains the industry's primary bottleneck.
