Viewpoint: Cryptocurrency hacking is a hidden transaction tax, and the cost is ultimately borne by the users

ARK Invest's Head of Digital Assets Research, Lorenzo Valente, stated that cryptocurrency hacks effectively constitute a hidden transaction tax and cost of value storage, similar to product theft in the retail industry, with related losses ultimately passed on to users through cost pricing. Each hack undermines the competitiveness of the crypto network.

Data shows that since 2018, the average market value lost annually in the crypto industry due to hacks accounts for 24 basis points (0.24%) of the total market value, while the losses from fraud in the U.S. banking system amount to only 1.7 basis points (0.017%), a difference of about 14 times.