Bybit Sees Over $4 Billion ‘Bank Run’ After Crypto’s Biggest Hack

Bybit Sees Over $4 Billion ‘Bank Run’ After Crypto’s Biggest Hack

Bybit Faces $5.5 Billion Outflow After Hack, Works to Secure Funds and Stabilize Operations

Bybit, one of the largest cryptocurrency exchanges, has faced a massive financial crisis following a $1.5 billion hack, believed to be carried out by North Korea’s Lazarus Group. In the aftermath, the exchange experienced over $4 billion in withdrawals, bringing total outflows to $5.5 billion.

CEO Ben Zhou revealed that while Bybit had the reserves to cover withdrawals, $3 billion in USDT was temporarily inaccessible due to a shutdown of Safe wallet functionalities. To address the crisis, Bybit worked urgently to secure a loan and develop new software to manually verify transactions, ensuring users could withdraw funds.

Despite efforts to stabilize operations, Bybit is reevaluating its custody solutions and collaborating with authorities, including Interpol, to track stolen funds. The debate over whether Ethereum should "roll back" the blockchain to recover lost assets also emerged but was met with strong opposition from the Ethereum community.