Thomas Daniels
After a disastrous $1.4 billion attack, one of the worst cryptocurrency breaches in history, Bybit has returned almost half of its Ether (ETH) assets. In addition to actively restocking its reserves through direct purchases, the exchange has received $390 million in emergency transfers from colleagues in the business.
The Quick Recovery of Bybit Following the Record-Breaking Hack
A $1.4 billion exploit that mostly affected liquid-staked ether (stETH), mantle-staked ether (mETH), and other ERC-20 tokens was discovered by Bybit on February 21. According to CryptoQuant data, Bybit’s Ether reserves recovered to around 50% of their pre-hack levels within 48 hours of the attack.
Bybit possessed more than 201,600 ETH as of 8:52 AM UTC on February 23, which is almost 45% of the 439,000 ETH it had before to the attack. On the day of the incident, the exchange’s Ether holdings had been momentarily reduced to just 61,000 ETH due to the breach.
Over-the-counter (OTC) purchases played a major role in Bybit’s recovery; according to Lookonchain, the exchange acquired 106,498 ETH valued at $295 million after the incident. Major industry participants also supported Bybit, enabling emergency liquidity transfers, such as:
- 50k Ethereum from Binance
- 40K Ethereum from Bitget
- 10,000 ETH from Du Jun, a co-founder of HTX Group
The crypto community’s strong vote of confidence is demonstrated by Bybit’s capacity to continue exchange operations and facilitate user withdrawals during the crisis. According to Bybit co-founder and CEO Ben Zhou, the exchange successfully completed 99.9% of the 350,000 withdrawal requests it processed in 10 hours by 1:45 AM UTC on February 22.
$390 Million in Cash Loans Boost Bybit’s Stocks
Through emergency ETH loans and contributions totaling $390 million, the cryptocurrency community provided Bybit with further support. According to blockchain analytics company Lookonchain, Bybit got:
Total loans and deposits of 145,000 ETH ($390 million) 127 million ETH from whales based on Binance 53 million from a single whale wallet
Bybit is still in a strong financial position in spite of the hack. The exchange’s entire asset worth fell by $5.3 billion, including the $1.4 billion that was taken, according to data from DeFiLlama. Independent proof-of-reserve (PoR) auditor Hacken has verified that Bybit’s reserves still surpass its liabilities.
The industry took a serious hit from today’s big breach. The final line is that Bybit still has more reserves than liabilities. We have verified that user money are still fully guaranteed as their independent PoR auditor,” Hacken said on February 21.
Investigating the $1.4 Billion Bybit Hack
Blockchain security experts, including Arkham Intelligence and ZachXBT, have linked the Bybit hack to the North Korean-affiliated Lazarus Group, the same entity behind the $600 million Ronin Network exploit.
Cyvers co-founder and CTO Meir Dolev pointed out that the Bybit hack was comparable to other hacks on WazirX ($230 million) and Radiant Capital ($58 million).
According to reports, the assault used a fraudulent transaction to target Bybit’s Ethereum multisig cold wallet, fooling signers into approving a harmful alteration to the smart contract’s logic.
Dolev told Cointelegraph, “It appears that a fraudulent transaction compromised Bybit’s ETH multisig cold wallet, fooling signers into unwittingly approving a malicious smart contract logic change.”
“The hacker was able to take over the cold wallet and move all of the Ethereum to an unidentified address as a result.”
Despite one of the worst security breaches in financial history, Bybit’s prompt response and community support show how resilient the crypto business is, restoring trust.
