Bybit Crypto Exchange Hacked: Latest News as of February 21, 2025

From Crypto futures trading
Jump to navigation Jump to search

Bybit Crypto Exchange Hack: Full Details as of February 21, 2025

On February 21, 2025, Bybit, one of the world's leading cryptocurrency exchanges, experienced a significant security breach, resulting in the theft of approximately $1.4–1.5 billion USD worth of Ethereum (ETH) and related tokens from one of its cold wallets. This incident has been labeled the largest cryptocurrency exchange hack in history by nominal value, surpassing previous notable breaches such as the Mt. Gox hack in 2014 ($470 million) and the Ronin Bridge exploit in 2022 ($650 million).

Details of the Attack

Bybit CEO Ben Zhou confirmed the hack via a livestream and social media posts, explaining that the breach occurred due to a sophisticated attack involving the manipulation of the user interface (UI) for transaction signing. The incident began when Bybit’s Ethereum multisignature (multisig) cold wallet initiated a routine transfer to a warm wallet. Hackers exploited this process by altering the smart contract logic of the cold wallet. The signatories, misled by a masked UI that displayed a legitimate address, unknowingly approved a transaction that redirected the funds to an unidentified address.

Blockchain data indicates that approximately 401,346 ETH (valued at around $1.1 billion at the time) along with staked Ethereum (stETH) derivatives were siphoned off. The stolen assets were subsequently moved to multiple new addresses, with portions already liquidated on decentralized exchanges (DEXes) such as Uniswap, Paraswap, and KyberSwap. Blockchain investigator ZachXBT was among the first to flag the suspicious outflows, prompting immediate attention from the crypto community.

Bybit’s Response

Despite the severity of the breach, Bybit has reassured users that the hack was isolated to a single ETH cold wallet. According to Zhou, all other cold wallets, warm wallets, and hot wallets remain secure, and withdrawals continue to operate normally, though some delays have been reported due to high demand. Zhou emphasized the exchange’s solvency, stating, “Bybit is solvent even if this hack loss is not recovered, all of clients’ assets are 1:1 backed, we can cover the loss.” He further clarified that the exchange would not immediately purchase ETH on the spot market to replenish the lost funds, as 80% of the required ETH has already been secured through bridge loans from partners.

Bybit is actively collaborating with blockchain forensic experts and other exchanges to trace the stolen funds and explore recovery options. Notably, industry figures such as Binance CEO Changpeng Zhao (CZ) and Tron founder Justin Sun have publicly offered support to assist Bybit during this crisis. The exchange has also partnered with Safe, a non-custodial wallet provider whose infrastructure was used in the transfer, to investigate whether its front-end was compromised—though Safe has stated there is no evidence of this so far.

Market Impact

The hack triggered immediate volatility in the cryptocurrency market. Ethereum’s price dropped by approximately 3–5%, falling to a low of around $2,680, though it later partially recovered. Bitcoin (BTC) also saw a decline, slipping to near $97,000, while altcoins experienced broader sell-offs. According to market data, the incident led to liquidations of leveraged positions worth roughly $100 million across major tokens. Open interest in perpetual swaps for BTC, ETH, and other cryptocurrencies plummeted, reflecting widespread panic among traders.

This event has reignited discussions about the vulnerabilities of centralized exchanges (CEXes) and the need for enhanced security measures. Taylor Monahan, lead security researcher at MetaMask, warned that the attack vector exploited in this hack mirrors patterns seen in previous breaches, such as those affecting WazirX ($235 million in July 2024) and DMM Bitcoin ($308 million in December 2024). She predicted that such incidents “will happen again and again” unless systemic improvements are made.

Ongoing Developments

Bybit has committed to maintaining transparency throughout the investigation, with Zhou providing real-time updates via livestreams and social media. The exchange has assured users that client funds remain safe and that operations will continue uninterrupted. Meanwhile, Arkham Intelligence has launched a bounty offering 50,000 ARKM tokens (approximately $33,600) for information leading to the identification of the hackers, with findings to be shared with Bybit to aid in fund recovery.

As of 10:52 AM PST on February 21, 2025, the investigation remains ongoing, with no definitive information yet on the perpetrators or the full scope of recoverable assets. The crypto community continues to monitor the situation closely, with Bybit’s handling of the crisis seen as a potential benchmark for how exchanges respond to such unprecedented breaches.

Sources

Retrieved from "https://cryptofutures.trading/index.php?title=Bybit_Crypto_Exchange_Hacked:_Latest_News_as_of_February_21,_2025&oldid=12735"