Add as a preferred source on GoogleARK Invest Researcher Says Crypto Hacks Add Hidden Costs for Users
Lorenzo Valente put average annual crypto hacking losses at 0.24% of market capitalization since 2018, compared with 0.017% of U.S. bank deposits lost to fraud.
Crypto hacking losses may become an indirect cost for users when businesses account for stolen value in their pricing, ARK Invest digital assets research head Lorenzo Valente argued in a Nov. 3 post.
Valente put average annual hacking losses in the crypto industry since 2018 at 0.24% of total market capitalization. He put fraud-related deposit losses in the U.S. banking system at 0.017%, making the crypto figure about 14 times the U.S. banking figure.
The comparison uses different measures: crypto losses as a share of total market value and bank fraud losses as a share of deposits. Valente compared the effect with retail theft, arguing that businesses pass related costs to customers.
He also argued that each hack weakens crypto networks’ competitiveness.