Bybit, the prominent Dubai-based and second-largest cryptocurrency exchange in the industry, suffered one of the largest hacks in crypto history on Friday last week.
In a stealth theft that put $1.4 billion worth of crypto assets at risk, hackers gained access to one of Bybit’s Ethereum cold wallets. To the shock and surprise of the Web3 community, they successfully transferred over 401,000 Ethereum and various staked Ether tokens to multiple unidentified addresses.
Though the Bybit exchange’s CEO and co-founder Ben Zhou had instantly assured customers of backing their assets 1:1 while completing all the withdrawal requests as of now, the theft has left heartbeats of crypto world racing while leaving their eyes hooked on the genuine leadership response and assurance.
Thus, CoinGape brings to its readers this exclusive Opinion Piece with Bitget CEO Gracy Chen, a prominent figure in the industry. Here, she discusses Bitget’s support to Bybit following Hack, challenges to be resolved for the Crypto Security and the requirement of a collective approach to prevent such hacks in future.
As of now, Bybit has processed all of the withdrawals on the platform. Bybit is a respected competitor and partner to us. This loss, even though extremely significant, is roughly about a year’s profit of the exchange. We will continue to monitor the incident, and if Bybit needs more support, we’re here to provide,” says CEO Gracy Chen.
Upfront War on the Hackers
Ongoing investigations into the Bybit hack have traced the attackers’ links to North Korea, with the suspected entity identified as the ‘Lazarus Group.’ Elliptic Intelligence, the blockchain analytics firm conducting the investigation, has identified over 11,000 wallets associated with North Korean hackers.
In just four days since the attack, the Bybit hacker has laundered 100,000 ETH—worth approximately $250 million. Shockingly, this surpasses the amount held by Ethereum’s founder, Vitalik Buterin.
However, what stands out in the aftermath of the Bybit hack is the united front displayed by major crypto entities. Various exchanges and industry players have come together to provide support to Bybit in a collective effort to strengthen Web3 security
In a separate Feb. 22 announcement, Bybit CEO Zhou expressed gratitude for the outpouring of support in the wake of the single biggest hack in crypto history. Right after the attack, Bitget received support from Antalpha Global, Pionex, MEXC, SoSoValue, Galaxy Digital, FalconX, Lido Finance, the Solana Foundation, the Ton Foundation, Ghaf Capital, Fenbushi, Bitvavo, and Tether.
Crypto.com CEO Kris Marszalek directed the company’s cybersecurity team to reach out to Bybit to offer assistance to the centralized exchange. In a peer exchange assistance right after the hack, Bitget too transferred 40,000 ETH to Bybit.
On the support to Bybit, CEO Gracy Chen responds, “Bitget transferred 40,000 ETH (worth roughly $105 million) to Bybit to support them in dealing with the situation. These are Bitget’s own funds, which we have sent for the goodwill of the cryptospace.”
At Bitget, we strongly believe in supporting the community and everyone contributing towards the growth of crypto. The largest crypto hack in the industry was carried out on Bybit. Our systems have blacklisted hacker’s wallets.
We will block any transactions flowing in from illicit addresses to the exchange once it has been monitored. Our team of security, and researchers, are currently tracking these activities. If we make any significant findings, we will share an analysis of this incident and what industry can do to avoid similar issues.
Assuring Bitget users too, CEO Chen says, “All Bitget’s users’ funds are securely stored on our platform and users can check the Proof of Reserve accordingly.”
It is also worth noting that in the latest turn of events, Bybit has repaid Bitget’s 40,000 ETH loan as of Feb 25.
The menace of Hacks in Crypto Industry
According to the Security Experts, Bybit Hack has emerged as the biggest single theft of any kind in the Web3 world. A data analysis by Cyvers has also called Bybit Hack ‘the single largest hack in the industry’s 15-year history.’ Further, it revealed that the stolen amount during the hack represented 60% of all Crypto funds that were stolen in 2024.
In the past too, there have been hacks but not really on Bybit scale. In March 2022, Ronin Network suffered the single largest hack of $600 mn worth of Ether and USD coins. Another hack happened in 2021 suffered by the cross-chain protocol, Poly Network. The long-planned hack witnessed $600 million stolen from the network.
BNB Chain Bridge hack of roughly $568 million and Japanese exchange, Coincheck’s 2018 theft of NEM tokens worth $534 million constitute other such similar instances.
CEO Gracy Chen on the menace of hacks in Web3 Industry says, “Crypto industry is still an emerging space even though it holds over a trillion dollars worth of assets. Technical advancements take decades to come into play. For crypto, the mass attention has really helped it gain popularity but the ecosystem still undergoes many challenges yet to be resolved.”
Collective approach necessary to improve Web3 security
Since the hack, various experts and leaders have been weighing on the improvisation areas in the Web3 infrastructure.
Few have suggested restricting blind signing by users to approve transactions while others have talked about migrating to Distributed Multi-Party Computation (MPC) Wallets from multi-signage cold storage infrastructure. This latter call comes due to the fact that Multisig was the technology leveraged by hacked ETH cold wallets of Bybit.
Safe wallet, the provider of the multisig tech to Bybit’s Ethereum cold wallets recently made a phased roll-out after introducing new enhanced security features.
The hack has definitely exposed the vulnerabilities in the Centralised Exchanges (CEXs) infrastructure, however, the exact cause of the hack is yet to be identified despite various suggestions coming up. While certain people are calling for the Ethereum roll-back, there are others such as Adam Back suggesting faults in EVM technology as the root cause of continued hacks in the Web3 industry.
When asked for ways to prevent such hacks, CEO Gracy responded, “As of now, everyone including Bitget’s research team is analysing and monitoring the hack. Since Bybit’s Analysis on the hack is not out, we can’t confirm what exactly happened even though the whole space thinks they know. We will soon share updates on the incident and how exchanges can prevent them in future. Right now, technical forensic is studying the hack.
Nonetheless, a good way of continuing the community’s efforts in maintaining a sane emerging market is by being as transparent as possible, by sharing proof-of-reserves and keeping a protection fund aside for any unfortunate incidents as such. Once we gain more information, we will be able to pin down reasons more specifically and share cautionary preventions towards such organized hacks.”
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