Bybit Seeks Help Tracking $400M in Stolen Ethereum, 27.6% Untraceable

Bybit, a prominent cryptocurrency exchange, has issued a call to the community for assistance in tracking down $400 million in stolen Ethereum. The funds, which represent approximately 27.6% of the $1.4 billion stolen in a recent hack, have become untraceable due to the use of crypto mixers and decentralized cross-chain services. This marks a significant increase from March, when only 7.59% of the stolen assets were untraceable.

The surge in untraceable funds is attributed to the use of privacy-enhancing tools such as Wasabi Mixer and Thorchain. Wasabi Mixer, known for its anonymity features, was used to launder 944 BTC, worth over $90 million. Thorchain, a decentralized cross-chain platform, facilitated the swap of 531 BTC (equivalent to 18,206 ETH) into Ethereum. After passing through Wasabi, smaller amounts of the crypto were funneled through other privacy-focused platforms, including CryptoMixer, Tornado Cash, and Railgun. The assets were then moved across various crypto platforms like eXch, Lombard, LiFi, Stargate, and SunSwap, enabling the attackers to shift assets across multiple blockchains before converting them into fiat via peer-to-peer and over-the-counter exchanges.

Blockchain security firm Bitrace confirmed that the hackers are dumping stolen funds through OTC channels, with customers in multiple countries or regions reporting relevant cases. Despite the growing portion of untraceable funds, Bybit maintains that most stolen assets remain visible on-chain. The CEO of Bybit, Ben Zhou, stated that 68.57% of the stolen Ethereum can still be tracked, while only 3.84% of the funds have been frozen. Approximately 343,000 ETH (worth over $960 million) have been converted into about 10,000 BTC and scattered across nearly 36,000 wallets. Another 5,991 ETH, about 1.2% of the total, remains in Ethereum wallets spread across more than 12,000 addresses.

Zhou urged the crypto community to cooperate with the firm to trace the stolen funds, stating, “We welcome more reports, we need more bounty hunters that can decode mixers as we need a lot of help there down the road.” Within two months, the exchange has received 5,443 bounty submissions from on-chain sleuths. Of these, 70 have been verified, and 12 contributors have been rewarded $2.3 million. The exchange's proactive approach in seeking community assistance highlights the challenges faced in tracking and recovering stolen cryptocurrency, particularly when advanced privacy tools are employed.