Trouble in Paradise is an apt idiom to describe the current Bybit situation. A hacker took control of an Ether cold wallet on the centralized crypto exchange on Feb. 21, stealing roughly $1.5 billion in ETH-related tokens in the process.
The enormous hack shook the crypto world, with top cryptocurrencies, including Bitcoin, Ethereum, Ripple’s XRP, and Dogecoin all nosediving.
Bitcoin, the world’s largest crypto by market cap, is trading hands for $94,943 a 3.5% drop over the past day, while Ether’s price has dropped further — by 4.3% — and hovers at $2,631.
Meanwhile, Ripple’s XRP has shed 6.7% of its value, currently priced at $2.52 at press time, while OG meme coin Dogecoin (DOGE) has plunged by circa 6.5%.
Bybit Hit By Colossal $1.46 Billion Hack
On Friday, approximately $1.46 billion worth of Ethereum (ETH) and stETH were withdrawn from Bybit’s cold wallet, and a huge portion of these funds were then swapped on decentralized exchanges.
Bybit co-founder and CEO Ben Zhou confirmed the security incident in an X post, noting that a planned transfer was manipulated by bad actors, and the funds were siphoned.
<blockquote class=”twitter-tweet”><p lang=”en” dir=”ltr”>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 <a href=”https://twitter.com/safe?ref_src=twsrc%5Etfw”>@safe</a> . However the signing message was to change…</p>— Ben Zhou (@benbybit) <a href=”https://twitter.com/benbybit/status/1892963530422505586?ref_src=twsrc%5Etfw”>February 21, 2025</a></blockquote> <script async src=”https://platform.twitter.com/widgets.js” charset=”utf-8″></script>
“However, the signing message was to change the smart contract logic of our ETH cold wallet,” posited Zhou. “[The] hacker took control of the specific ETH cold wallet we signed and transferred all ETH in the cold wallet to this unidentified address.”
Shortly afterward, Zhou reassured users and the broader crypto industry that it would be able to deal with the loss.
“Bybit is solvent even if this hack loss is not recovered, all of clients’ assets are 1 to 1 backed, we can cover the loss,” he wrote, adding that all other cold wallets were secure and withdrawals were normal.
Flashbots strategy head Hasu also observed on X that the hack has not doomed Bybit.
“If you want my serious take, Bybit has way more than 1.4 billion of revenue per year,” Hasu opined. “They are good for the money and will make all customers whole. It doesn’t matter for ETH because Bybit will honor customers’ ETH liabilities and buy back the assets on the open market.”
Biggest Crypto Hack In History
The amount stolen from Bybit on Friday is enormous, even by crypto standards. Decentralized finance (DeFi) commentator Patrick Scott said on X that the hack represents “16% of ALL previous crypto hacks.”
<blockquote class=”twitter-tweet”><p lang=”en” dir=”ltr”>This Bybit exploit is the largest of all time, representing 16% of ALL previous crypto hacks. <a href=”https://t.co/XWs6xZvmdm”>pic.twitter.com/XWs6xZvmdm</a></p>— Patrick Scott | Dynamo DeFi (@Dynamo_Patrick) <a href=”https://twitter.com/Dynamo_Patrick/status/1892979314720711097?ref_src=twsrc%5Etfw”>February 21, 2025</a></blockquote> <script async src=”https://platform.twitter.com/widgets.js” charset=”utf-8″></script>
In 2024, Japanese-headquartered exchange DMM fell victim to the largest crypto hack of that year when hackers pilfered Bitcoin worth over $300 million at the time. Sam Bankman-Fried’s FTX was hacked for over $475 million in 2022.
Meanwhile, Binance founder Changpeng Zhao has offered to help Bybit while also recommending that the exchange should pause withdrawals as a security measure.
“Not an easy situation to deal with. Might suggest to halt all withdrawals for a bit as a standard security precaution. Will provide any assistance if needed. Good luck,” Changpeng quipped.
