The Impact of The Second Biggest Crypto Hack Ever

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Crypto is growing. It won’t be long until it becomes a trillion-dollar industry. However, the market has experienced some setbacks in recent times. The biggest hack ever of crypto tokens occurred in September of 2018 when the NEM foundation was hacked, and more than $ 500 million worth of its native token were stolen from their digital wallet. At that moment, NEM was among the top 10 most valuable blockchain companies; its market cap on that date was $ 1 billion. That hack had an impact on all other coins and tokens in general, including the world of gaming and its underlying technologies like blockchain and Smart Contracts. For those who don’t know what NFT stands for, it stands for Non-Fungible Tokens, which are different from Fungible Tokens (ERC-20). Fungible tokens are interchangeable with one another while non-fungible tokens have unique properties making them individualized or unique.

What is NFT?

NFT (Non-Fungible Tokens) are a very special kind of crypto tokens. With Fungible Tokens, every single one is identical to the next one. They are also interchangeable with each other. So if you exchange your token for 100 coins of another token, it doesn’t matter which specific coins you get in return. For example, if you get 100 gold coins as a prize, it doesn’t make any difference if you get 100 gold coins from one person or 100 gold coins from another person. They are all the same. NFTs are different from Fungible Tokens. They are unique and have their own identity which makes them distinctive from one another. The simplest way to understand the difference between non-fungible tokens and fungible tokens is to compare them to baseball cards and stacks of coins.

the Second Biggest Crypto Hack

How NFT Works?

NFTs are an integral part of the blockchain: a decentralized ledger that serves as a public database for recording transactions. It’s essentially an open-source technology that supports the trade of virtual assets through the use of smart contracts. The primary goal of blockchain is to create trust between two parties who don’t know each other. It does this by creating a digital ledger that’s transparent and can be accessed by the public. This way, all parties can see what’s happening even if they don’t trust one another. NFTs are used to create unique and verifiable virtual assets that can be used as a cryptocurrency. The most popular examples of NFTs are cryptocurrencies like Bitcoin, Ethereum, Litecoin, and Stellar, which are all used as a form of payment.

Blockchain Security: Solving the Problem of Trust

As mentioned above, the blockchain is a technology that allows two parties who do not trust each other to engage in a transaction. Both parties have access to the ledger and can see each other’s transactions. This means that if someone transfers assets to another person, both of them will be notified immediately. That’s how the blockchain works and that’s also how we can be certain that digital assets are secure. The blockchain uses complex algorithms and mathematical puzzles to create a secure, decentralized network that cannot be hacked. If you want to change anything in the ledger, you have to solve a complex mathematical puzzle. And as soon as you solve it, other people who are also using that ledger will solve the same puzzle and notice what you’re trying to do.

The Impact of Crypto’s Biggest Hack Ever

The biggest hack ever of crypto tokens occurred in September of 2018 when the NEM foundation was hacked and more than $ 500 million worth of its native token were stolen from their digital wallet. At that moment, NEM was among the top 10 most valuable blockchain companies; its market cap on that date was $ 1 billion. That hack had an impact on all other coins and tokens in general, including the world of gaming and its underlying technologies like blockchain and Smart Contracts. Gaming is one of the most lucrative industries in the world, generating a staggering $ 130 billion in revenue in 2019. It’s expected to reach a staggering $ 200 billion by 2022. The industry has seen a major shift from traditional gaming to the rise of esports and virtual reality. The one segment that has remained the same is the trading of in-game assets. That’s a marketplace that has been around for decades and it’s a huge industry.

Final Thoughts

The growth of blockchain and its underlying technologies like NFTs are revolutionary. The gaming industry will benefit tremendously from these technologies: not only will it help reduce fraudulent activity but also enable gamers to earn actual money. For blockchain and NFTs to become mainstream, however, crypto exchanges need to overcome their biggest challenges first: liquidity and trust. That’s only possible if they are able to solve the problem of trust by implementing robust security systems that protect the crypto assets of their users.

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