Crypto has lost 24 basis points of market cap annually to hacks since 2018, a 14x higher rate than traditional banking fraud losses.
Security & Exploits ·
Research comparing security losses across crypto and traditional finance shows a stark disparity. According to analysis by ARK, the crypto sector has shed an average of 24 basis points of market capitalization annually to hacks since 2018, compared to 1.7 basis points of deposits lost to fraud in the US banking system—a 14-fold difference. Year-to-date losses through 2026 reached 0.33 percent or $8.5 billion, with a single incident accounting for $6.36 billion.
The cumulative toll since 2018 totals approximately $25 billion or more, functioning as what researchers describe as an invisible tax that embeds security risk into crypto valuations. This persistent loss rate stands in contrast to recent years, which have seen lower percentage losses, suggesting some improvement in security practices or incident frequency.
The gap raises questions about whether crypto's security vulnerabilities represent a structural challenge to mainstream adoption or reflect a transitional phase as the ecosystem matures. Whether the $25 billion figure has stabilized or continues to grow, and how recent security improvements may narrow the disparity with traditional finance, remains unclear from available data.