Bybit Crypto Exchange Hit With Record $1.4 Billion Ethereum Hack
Ethereum fell after the world's second-largest crypto exchange suffered a $1.4-billion exploit
By: Zack Guzman
February 21, 2025
The world's second-largest crypto exchange Bybit suffered an exploit Friday that saw it drained of about $1.4 billion worth of ethereum and staked ether.
Bybit CEO Ben Zhou immediately shared news of the exploit Friday morning on X, linking to the Ethereum transaction in question and explaining that the exchange was still solvent, even if it's never able to recover the exploited funds.
"Bybit is still processing withdrawals," Zhou said on a Bybit livestream as he and the company battled "massive withdrawals" in the hours after the hack. "Please rest assured that all other cold wallets are secure. All withdrawals are normal."
Ethereum traded about 5% lower as onchain sleuths tracked the exploiter moving and liquidating what was exploited from Bybit. Just a few hours after the hack, Arkham Intelligence had already tracked the hacker moving funds into multiple wallets and liquidating millions in ether.
Bybit ETH multisig cold wallet just made a transfer to our warm wallet about 1 hr ago. It appears that this specific transaction was musked, all the signers saw the musked UI which showed the correct address and the URL was from @safe . However the signing message was to change…
— Ben Zhou (@benbybit) February 21, 2025
In another follow up stream, Bybit's Head of Derivatives Shunyet Jan corrected the speculation he was seeing on X about whether Bybit would be preparing a purchase for Ethereum on the open market.
"Our treasury has more than enough reserves to cover the Ethereum notional amount, but we don't have enough Ethereum right now," he said, adding that it would be more likely the company would line up a bridge loan of Ethereum for customers looking to withdrawal ether. "I think we're going to have to discuss what the best course of action is."
Noted pseudonymous blockchain researcher ZachXBT submitted proof hours after the hack that the party responsible was North Korea's Lazarus Group. The proof was enough to have Arkham Intelligence bestow ZachXBT with its bounty it had set up to investigate the hack.
BREAKING: BYBIT $1 BILLION HACK BOUNTY SOLVED BY ZACHXBT
— Arkham (@arkham) February 21, 2025
At 19:09 UTC today, @zachxbt submitted definitive proof that this attack on Bybit was performed by the LAZARUS GROUP.
His submission included a detailed analysis of test transactions and connected wallets used ahead of… https://t.co/O43qD2CM2U pic.twitter.com/jtQPtXl0C5
The infamous hacker group has been revealed to be behind many crypto hacks in the past, including the $600 million Ronin hack and the 2023 hack of Atomic Wallet for $100 million.
Not all funds from crypto hacks are permanently lost. Coinage previously reported on the $200 million exploit of Euler Finance, which ended after the hacker returned all of the funds.
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