Bybit Recovers $1.46B in Ethereum After Historic Hack – But Does It Still Owe Money?

Bybit, one of the world’s largest cryptocurrency exchange, suffered a massive security breach, losing over $1.46 billion in what is now the biggest crypto theft in history. The attack primarily targeted Bybit’s Ethereum multi-signature cold wallet, which was used for daily trading operations. According to Lookonchain, Hackers exploited a phishing vulnerability to manipulate the signing interface, allowing them to drain $1.23 billion worth of ETH. 

Ben Zhou’s Leadership in Crisis

Despite the massive setback, Bybit’s CEO Ben Zhou led the company through a rapid recovery. The exchange acted immediately, securing emergency loans, using investor deposits, and making direct ETH purchases to cover the stolen amount. Within just two days, Bybit had fully recovered its holdings, showcasing its commitment to user protection.

Zhou in his X post assured users that their funds remained safe and emphasized Bybit’s financial strength. 

Major crypto players, including Binance, Bitget, MEXC, Mirana Ventures, Fenbushi Capital, and MMDWF Labs, also stepped in to support the exchange, stabilizing liquidity and boosting investor confidence. To maintain complete transparency, Zhou confirmed that Bybit would soon release a Proof of Reserves (PoR) audit.

Where Did the Funds Come From?

Bybit quickly recovered its lost ETH by pulling funds from different sources. The biggest chunk came from private deals, bringing in 157,660 ETH ($437.8 million), while crypto exchanges added another 109,033 ETH ($304.1 million). Large investors and institutions lent 47,800 ETH ($127.5 million), and Bitget chipped in with a 40,000 ETH loan ($106 million). Smaller private deals contributed 22,609 ETH ($61.8 million), and various investors sent amounts between 2,200 ETH ($6 million) and 20,000 ETH ($53.7 million). This combined effort helped Bybit fully replace the stolen funds in record time.

While his efforts were praised by many like comparing it with Bitfinex’s hack many are not happy with Zhou’s claims. Crypto analyst, Hermes Psychopomp questioned Bybit’s claim of fully recovering its losses, pointing out that since the exchange used loans, it still owes money. He criticized the crypto industry for making things sound better than they are.

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Impact on the Crypto Market

With Bybit securing the lost ETH, buying pressure in the market has eased. This has led to a decline in Ethereum’s price, which dropped from $2,800 to around $2,700 as the artificial demand subsided. Meanwhile, Bybit is actively tracking the stolen funds, which are believed to be in the hands of North Korea’s Lazarus Group. Blockchain analysts predict that the hackers may use Bitcoin mixers to further conceal the stolen assets.

Bybit’s upcoming audit will be crucial in restoring investor confidence, proving that the exchange remains solvent despite the attack. The crypto community has praised Bybit’s quick response, preventing a liquidity crisis and keeping the platform operational.