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Bybit: confirmed hack of over $1 billion
By Davide Grammatica
The crypto exchange Bybit has confirmed a hack of over $1 billion in ETH. User funds are reportedly safe, and the exchange's activity is not compromised
New problems for Bybit
After some concerns shared on social media by the community, the crypto exchange Bybit has confirmed that it has suffered a hack of over a billion dollars in ETH.
“The Bybit ETH multisig cold wallet just made a transfer to our warm wallet about an hour ago, and it appears that this specific transaction was ‘musked’: the signatories ended up modifying the smart contract logic of our ETH cold wallet,” Ben Zhou, CEO of Bybit, wrote in a post on X. “The hacker took control of the specific ETH cold wallet we signed, transferring all ETH in the cold wallet to an unidentified address. All other cold wallets are safe, and all withdrawals are available.”
Bybit ETH multisig cold wallet just made a transfer to our warm wallet about 1 hr ago. It appears that this specific transaction was musked, all the signers saw the musked UI which showed the correct address and the URL was from @safe . However the signing message was to change…
— Ben Zhou (@benbybit) February 21, 2025
By the term “musked”, Zhou is referring to a deceptive user interface created on purpose to trick the signatories of a given transaction into approving a malicious operation. This is exactly what happened: the modification of a specific smart contract resulted in a redirection of funds, and so the hacker gained control of the CEX’s cold wallet.
In a short time, the hacker has already been able to distribute the stolen funds to several wallets, starting from three separate “distribution” addresses. These, in turn, subdivided the funds once again, starting exchange operations on various decentralized exchanges. Until a few minutes ago, the wallet used first by the hacker contained “just” 3.7 million dollars in crypto.
“Users' funds are safe”
In any case, the CEX has confirmed that user funds would not be at risk, and that the CEX’s activity would not be compromised either.
“Even if these funds are not recovered, all customer assets are backed 1 to 1, and we can cover the loss,“ Zhou wrote.
“All withdrawals will be processed without issue,” he added.
“If there are delays in withdrawals, it’s because there are so many going through due to panic and the queue is long, but there are funds for everyone”.
According to BitMEX Research, around 75% of users’ ETH deposits have been compromised.
Meanwhile, the news has had a significant impact on the markets. Bitcoin, which was about to find the strength to attempt the assault on $100k, suffered a sharp slowdown, and then in the last few minutes has settled back around $98k. The same dynamic has affected ETH, which rose in the last day to $2,900, and has now stumbled to $2,700.
Ben Zhou, the CEO, has just started a live broadcast where he answers all questions about the incident:
Ben Zhou’s Livestream on the Latest ETH Wallet Incident LIVE now. https://t.co/mBwD9ubGIl
— Bybit (@Bybit_Official) February 21, 2025
Finally, he states: “We will not buy back ETH on the market, but we will take out a loan from a bridge partner to avoid generating price volatility”.
Having said all this, the same golden rule always applies: your funds are 100% safe ONLY in your wallet.
