Bybit Hack: $1.4B Crypto Heist Sends Markets Tumbling

Bybit, a leading cryptocurrency exchange, has suffered a significant security breach, resulting in the theft of approximately $1.4 billion worth of ether (ETH) and staked ether (stETH). The hack was first flagged by blockchain analyst ZachXBT, who confirmed the breach through his sources. Bybit's CEO, Ben Zhou, later confirmed the attack, stating that the hacker gained control of one specific cold wallet, transferring all its ETH.

The stolen funds, totaling 401,346 ETH, represent 8.64% of the exchange's total reserves, which were valued at $16.2 billion before the hack. According to data from Arkham Intelligence, around $1 billion worth of ETH (400,000 ETH) has been transferred to new wallets from the original hack address. As of now, the Bybit Hacker currently holds $1.37B of ETH and has used 53 wallets so far.

The hack has had a significant impact on the crypto market. Bitcoin (BTC) dropped to around $97,000 after briefly approaching $100,000 earlier in the day, while ether (ETH) fell by almost 4%, dropping below the $2,700 mark. The sudden price drop triggered the liquidation of about $100 million in leveraged derivatives positions, mostly from long traders expecting prices to rise.

The crypto market is reversing earlier gains in the day and is now in a downtrend. The sell-off is much larger than in the stock market, which is also down. While the impact may be temporary, the market declines show signs of mild investor panic, which is further worsened by the weak performance of U.S. stocks.