Cryptocurrency exchange Bybit experienced a devastating security breach on Friday, resulting in the theft of $1.4 billion worth of Ethereum (ETH), but the exchange founder has said today it has managed to almost cover its ETH losses via loans, whale deposits, and ETH purchases.
This incident is now recognized as the largest cryptocurrency hack in history, surpassing the 2021 Poly Network breach, which saw $611 million stolen.
The attackers targeted Bybit’s Ethereum cold wallet, compromising 401,347 ETH ($1.12 billion), 90,376 stETH ($253 million), 15,000 cmETH ($44 million), and 8,000 mETH ($23 million), according to blockchain analytics firm Onchain Lens. This massive loss marks a dark moment in cryptocurrency history, eclipsing previous high-profile hacks.
Bybit’s co-founder and CEO, Ben Zhou, confirmed the incident during a livestream, stating that the hackers took control of one of the company’s cold wallets, believed to be secure due to its offline status, and transferred the funds to an online “warm” wallet.
Zhou announced today that Bybit is “also getting help from Interpool and international regulatory bodies” and that it had managed has already fully closed the ETH gap”.
“A new audited POR report will be published very soon to show that Bybit is again Back to 100% 1:1 on client assets through merkle tree, Stay tuned”, Zhou said in X.
In response to the unprecedented breach, Bybit launched a recovery bounty program, offering up to 10% of the recovered funds – a potential reward of $140 million – to ethical cyber and network security experts who help retrieve the stolen assets. This initiative is one of the largest crypto recovery efforts in history.
“Within 24 hours of the event, we were overwhelmed with support from some of the best people and organizations in the industry, and we do not take it for granted. We have shared in a dark moment of crypto history, and we’ve proven we are better than the malicious actors,” Zhou said. He also assured users that Bybit remains solvent and can cover the loss even if the stolen assets are not recovered.
The exchange then stated it was collaborating with top blockchain forensic experts to trace the stolen funds and address the situation.
‘Our security team is investigating the root cause, focusing on a potential vulnerability in the user interface of the Safe.global platform that may have been exploited during the transaction process. Withdrawals are operating normally, with 70% of pending requests already processed. While some delays may occur due to high volume, this does not affect your ability to access your funds’ Bybit said after the hack.
‘Bybit has ample assets to cover the loss, with assets under management exceeding $20 billion, and will utilize a bridge loan if needed to ensure the availability of user funds. Our platform and all other services, including trading products, cards, and P2P, are fully operational’.
Bybit, headquartered in Dubai, held an estimated $16 billion in total assets as of last week, according to CoinMarketCap. The incident highlights the ongoing security challenges facing the cryptocurrency industry, with total crypto thefts amounting to $2.2 billion in 2024, according to Chainalysis. The exchange was established in 2018, and serves over 60 million users across the globe.
Shogun Lin
