Bybit's $1.4B Crypto Heist: Largest Ever, Exchange Vows to Recover

Bybit, a leading global cryptocurrency exchange, has suffered a record-breaking hack, with over $1.4 billion worth of Ethereum (ETH) stolen from its cold wallet. This incident, according to blockchain analysis firm Elliptic, is the largest crypto theft in history, surpassing the previous record of $611 million stolen in the 2021 Poly Network hack.

Bybit's CEO, Ben Zhou, swiftly addressed the incident on social media, reassuring customers that the exchange remains financially stable and that all client assets are one-to-one backed. He stated that Bybit can cover the loss even if the stolen funds are not recovered.

The hack was carried out by deceiving Bybit's cold wallet signers into conducting a malicious transaction, granting the hackers control over the wallet. The wallet involved transferred 401,346 ETH ($1.1 billion) and other forms of staked ether (stETH) to another wallet, which is now selling mETH and stETH on decentralized exchanges. So far, about $200 million worth of stETH has been sold.

The incident has raised serious concerns regarding the security of centralized exchanges and the evolving threat landscape in Web3, as stated by CertiK, a blockchain security firm. In response, Arkham Intelligence has created a bounty to help identify the individuals or organizations behind the hack, offering a reward of 50,000 ARKM tokens for helpful information.

The hack has drawn reactions from the crypto community, with Binance founder and former CEO Changpeng Zhao (CZ) suggesting that Bybit halt all withdrawals as a standard security precaution. Despite the large amount stolen, industry experts believe that Bybit will recover and make all customers whole.