Crypto has revolutionized finance, but not without collateral damage. For every breakthrough in blockchain technology, there’s been a corresponding breach of trust. As fortunes ballooned, so did greed, fraud, and negligence. This article unpacks the largest crypto scams and hacks in history, revealing the patterns behind them and what today’s users and investors can do to protect themselves.
1. Mt. Gox (2014) – The Original Exchange Collapse
Once the world’s dominant Bitcoin exchange, Mt. Gox handled 70% of global BTC trading. But behind the scenes, its systems were riddled with security flaws. In early 2014, the exchange halted withdrawals, citing “technical issues.” Days later, it declared bankruptcy, revealing that 850,000 BTC had been stolen. At the time, this equaled $460 million. Today, that stash would be worth billions.
The breach wasn’t an overnight affair, it occurred slowly over time due to poor internal controls and hot wallet vulnerabilities. The company had no proper audit systems, and the founder, Mark Karpelès, was overwhelmed by technical and legal issues. The Mt. Gox collapse taught the crypto world a hard lesson: centralization without oversight is a recipe for disaster.
2. OneCoin (2014–2019) – A Global $4 Billion Ponzi Scheme
OneCoin was never a real cryptocurrency. Marketed as a “Bitcoin killer,” it was, in fact, a centralized database with no blockchain, mining, or transparency. Founded by Ruja Ignatova, the project aggressively recruited investors via seminars and multi-level marketing, particularly across Africa, Asia, and Eastern Europe. It promised sky-high returns and VIP “education packages.”
By 2017, authorities began investigating and Ruja disappeared. She has been on the FBI’s Most Wanted list ever since. Estimates suggest OneCoin stole over $4 billion, with many investors never recovering their funds. The scam exemplifies how hype and lack of understanding can be weaponized at scale in the crypto world.
3. BitConnect (2016–2018) – Hype, Memes, and a Multi-Billion-Dollar Collapse
BitConnect became notorious for its infamous promise of 1% daily returns using a so-called “trading bot.” It wasn’t long before the bot’s legitimacy was questioned, but by then, thousands had already invested. At its peak, BitConnect’s token (BCC) reached a market cap of over $2.5 billion.
When regulators in the U.S. and abroad started issuing warnings, the house of cards fell. BitConnect shut down its exchange in January 2018, and the BCC token lost 90% of its value within days. Beyond the financial losses, BitConnect became a meme symbol of crypto irrational exuberance and a warning about too-good-to-be-true returns.
4. FTX (2022) – The Most Stunning Fall in Crypto History
FTX was seen as the gold standard among centralized crypto exchanges. With billions in venture capital backing, celebrity endorsements, and a charismatic founder in Sam Bankman-Fried (SBF), few suspected the chaos behind the curtain. In late 2022, it emerged that FTX was using customer funds to prop up SBF’s trading firm, Alameda Research, a massive conflict of interest and a breach of fiduciary duty.
As withdrawals surged, FTX became insolvent within days. An $8+ billion hole was discovered. In 2023, SBF was convicted on fraud charges and sentenced to 25 years in prison. The FTX debacle didn’t just wipe out billions; it erased trust and ushered in a new wave of regulatory scrutiny worldwide.
5. Terra / UST (2022) – The Death Spiral That Lost $40 Billion
Terra’s UST was an algorithmic stablecoin designed to maintain its peg to the U.S. dollar by burning or minting its sister token, LUNA. When market confidence cracked in May 2022, UST lost its peg. Investors tried to exit, causing a massive minting of LUNA and a catastrophic collapse in both tokens’ value.
Over $40 billion in value was wiped out almost overnight. Do Kwon, the project’s controversial founder, faced lawsuits and international warrants. Though not a hack or scam in the traditional sense, Terra’s implosion highlighted the dangers of financial engineering without collateral and the blind trust of speculative investors.
6. Ronin Network (Axie Infinity Hack, 2022) – $625 Million Gone
The Ronin Network, which powered the popular play-to-earn game Axie Infinity, fell victim to one of the largest hacks in crypto history. Attackers used compromised private keys to forge fake withdrawals, stealing over $625 million in ETH and USDC. The breach went undetected for nearly a week.
The fallout was massive. Sky Mavis, Axie’s developer, was forced to raise emergency funds and implement stronger decentralization measures. Investigators later linked the attack to North Korea’s Lazarus Group. The hack exposed the high risk of using lightly secured validator nodes and the weaknesses of centralized DeFi infrastructure.
7. Poly Network (2021) – $611 Million Hack with a Twist
In one of the most bizarre episodes in crypto, a hacker exploited a vulnerability in Poly Network’s smart contract logic to transfer $611 million in assets. Unlike most attacks, this one had a strange ending: the hacker returned the funds voluntarily over several days, claiming it was “for fun” and to expose flaws.
Poly Network offered the attacker a security advisor role, though the identity was never fully confirmed. The event raised tough questions about white-hat ethics, smart contract audits, and the community’s preparedness to respond to large-scale exploits with diplomacy rather than force.
8. Wormhole Bridge (2022) – The Bridge That Burned $325 Million
Cross-chain bridges like Wormhole allow users to move assets between blockchains, but they also introduce complex vulnerabilities. In February 2022, a hacker exploited Wormhole’s Solana-Ethereum bridge to mint 120,000 wrapped ETH without backing, draining $325 million from the protocol.
Jump Crypto, a major backer, stepped in to refill the hole, preventing a wider meltdown. Still, the attack illustrated the systemic risks of bridges and led to a wave of projects rethinking how to approach interoperability and validator security.
9. Mango Markets (2022) – Market Manipulation Gone Rogue
On Solana-based Mango Markets, an attacker manipulated the price of the MNGO token to inflate their collateral value, then took out loans against it to drain $116 million. They later proposed returning some funds if the protocol agreed not to pursue legal action, a deal that was ultimately ignored when charges were filed.
The exploit wasn’t a traditional hack, it was a legal gray area of price manipulation using smart contracts. It sparked intense debate in the crypto world about whether this constituted theft or simply a loophole being used aggressively. For decentralized finance, it was a wake-up call about governance and economic vulnerabilities.
10. PlusToken (2018–2019) – A Wallet App That Disappeared with Billions
PlusToken gained popularity in Asia by offering high-yield returns to users who stored their crypto in its wallet app. Behind the scenes, it operated like a textbook Ponzi scheme, paying old users with funds from new ones. Eventually, the scheme collapsed, and the operators disappeared with over $2 billion in assets.
Several of the core team members were arrested in China, but many believe the full scope of the scam hasn’t yet been uncovered. PlusToken reportedly played a role in Bitcoin price volatility in 2019 as the stolen funds were liquidated. It remains one of the least talked-about yet most damaging crypto crimes.
What These Events Reveal
From centralized custodians to decentralized protocols, no corner of the crypto world has been safe from bad actors or systemic failure. These events highlight recurring issues: centralized control of funds, lack of transparency, weak governance, and overhyped promises. Whether through malicious intent or flawed design, these failures demonstrate that trust must be earned, not assumed.
How to Protect Yourself
- Use cold wallets for long-term storage—avoid keeping funds on exchanges.
- Research teams and verify if they are doxxed, reputable, and transparent.
- Be skeptical of sky-high APYs, referral schemes, or closed-source codebases.
- Don’t chase hype—evaluate real utility, community trust, and smart contract audits.
Conclusion: Learn from the Wreckage
The crypto industry has seen enormous growth, but it’s also been marked by repeated failures. As blockchain technology matures, so must its safeguards. The best way to honor those who lost billions in scams and hacks is to make sure their pain wasn’t in vain. Use their stories as your armor. Stay vigilant, stay informed, and stay sovereign.