A huge security breach has been suffered by the cryptocurrency exchange Bybit. The hackers stole around $1.5bn worth of Ethereum (ETH), around 400,000. As a result, this was one of the largest crypto hacks in history.
The attack was on Bybit’s cold wallet. Generally, a cold wallet is safer compared to an online wallet because it is not connected to the internet. But through security, hackers broke the way and moved the stolen money to an unknown address. Most of the crypto world was surprised by the hack. Investors became concerned about their money and their security. This has set off a storm of nerves in the crypto industry, concerning its safety of it.
Bybit’s Response and User Concerns
Ben Zhou, Bybit’s CEO, confirmed the attack. According to him, the only wallet related to it, and all other funds are safe. Withdrawing money is still working, the company has promised, as will the operations. That loss is already accounted for in a bridge loan that Bybit secured with its partners. These loans cover 80% of the stolen amount. The company also said that as a matter of course, it would fully repay all users affected to the extent necessary. After that, several users rushed to withdraw their money. As a result, huge withdrawal requests increased and hence delays. Bybit is moving money between wallets so that all users get their funds. Some people still trust Bybit, but others fear another attack. These days, lots of users are quite extra wary of putting cash in crypto.
Who is Behind the Attack?
It could be the victims of a North Korean hack. It is suspected that the group of Lazarus Group is responsible. The latter is a group that has stolen millions in past crypto attacks.
The Ethereum is already being transferred to various wallets. That indicates the hackers are trying to convert the money and exchange it with other assets. The stolen funds are being tracked down by law enforcement agencies and defence companies. It is very difficult however to catch these hackers. Often, they will try to make it impossible to trace the money through decentralized exchanges or crypto-mixing services. Many of the crypto platforms are now watching any suspicious transactions. They will try to block the stolen funds if they find them.
Ethereum and the Crypto Market Impact
The hacker now holds 489,000 ETH, and with that moves to the 14th position in the world in terms of holders of Ethereum. Now they have more ETH than some big crypto companies such as Ethereum Foundation and its co-founder Vitalik Buterin.
With the hack, Ethereum’s price fell by almost 4%. But it later recovered slightly. The demand for ETH could go up because Bybit will need to buy Ethereum to meet its losses. It may even cause prices to go higher in the future. Hacker’s wallets are being blocked at crypto exchanges. That means the stolen funds will not be easily sold to the hacker. Other experts think that since the hacker is unable to sell the ETH, the funds will remain trapped. This could also affect the supply of Ethereum and the market in ways that were unexpected.
Now, Bybit is highly motivated to build back trust and tighten its security. The fact is that even the biggest crypto platform like Nakamoto is vulnerable to being hacked. Investors always need to be careful and be very careful with funds and are advised to take extra security steps to secure their funds.
