The Biggest Exchange Hack...Ever?

Hey there, Degens!

Before you spill your coffee: Yes, Bybit just got hacked. And no, we’re not talking about a measly few million. We’re talking a mind-blowing $1.4 billion—poof—vanished like that shady friend who said they'd pay you back.

Yup. Biggest crypto exchange hack in history. Grab your tinfoil hats and let’s dive in.

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Bybit’s Bad Dream

• What Happened? Hackers sneaked their way into Bybit’s multi-sig cold wallet. Multi-sig’s supposed to be “Fort Knox with extra locks,” but apparently, these criminals said, “Hold my beer,” tricked every signer, and drained the entire Ethereum stash.

• $1.4 BILLION GONE: That’s 401,347 ETH plus some fancy staked derivatives (like stETH) for good measure. The thieves wasted no time scattering the loot across 40+ wallets, presumably cackling like cartoon villains.

• Biggest Hack Ever: Congrats, Bybit. Your fiasco dethroned every heist we thought was huge. Cue the sad party Violin.

The Chaos Unfolds

ZachXBT, On-Chain Sleuth Extraordinaire: Our favorite blockchain detective was the first to throw the red flag. He noticed suspicious outflows from Bybit’s wallet.

Ben Zhou hopped on a livestream to say, “Chill, guys, we can cover it. We manage $20B.” Also, they’re apparently seeking a “bridge loan” from buddies to keep ETH withdrawals afloat. Because, y’know, losing $1.4B kinda stings.

User Funds ‘Safe’? They claim so, but let’s be honest—any time an exchange says “funds are safe,” the entire market collectively clenches.

Lazarus Group or Just Another Evil Genius?

• All Fingers Point to Lazarus Group: The North Korean hackers that love stealing crypto (and your hopes and dreams). So far, on-chain investigators see their fingerprints all over the place.

• Sneaky Tactics: The hackers tricked Bybit’s multi-sig signers into signing a malicious contract. In other words, “Sign here to verify a normal transaction”—except it was actually the flight ticket for your precious ETH.

• The Great Escape: They’re rumored to be bridging out of ETH to avoid stablecoins (which Tether or Circle can freeze). Sigh. If only we could just freeze them in carbonite.

Ripple Effects: Market Down ~$200B

• The entire crypto market collectively said, “Not again…” and lost about $200 billion in market value. BTC dipped below $96K, ETH to $2,600-ish, and a whole bunch of altcoins curled into the fetal position.

• People are panic-selling, blaming Bybit for tanking their precious meme bags. But let’s face it: If a $1.4B hack doesn’t spook you, you probably have diamond hands made of vibranium.

Bybit’s Bounty: $140M for Ratting Out the Hackers

• In a last-ditch “Hail Mary,” Bybit put up 10% of recovered funds—a possible $140 million—for anyone who helps track down the loot. That’s some John Wick bounty-level stuff. If you’re a code nerd with hacking detective skills, you could be richer than your favorite influencer in a matter of weeks.

• Meanwhile, the rest of us can only watch from the sidelines, munching popcorn, secretly hoping we get some extra airdrop or something.

So…Should I Run From Bybit?

• They say they can cover the losses. They also said user funds are safe, and “other wallets” are unaffected. Are they telling the truth? Probably yes—no exchange wants to appear incompetent.

• But also, holy multi-sig meltdown, Batman! This is a grim reminder that not your keys, not your coins. If you need your funds on an exchange, maybe don’t store everything in one basket.

We talked about “Not not your keys, not your coins” before, check it out here:

Ethereum’s Existential Crisis, Coinbase Drama, and Why “Not Your Keys” Matters 

Final Take

Look, it’s a dark day in cryptoland. The second-largest exchange by trading volume got absolutely rekt by cunning criminals. Some see it as a sign to “get out while you can.” Others see it as a weird opportunity—like, “Hey, that’s $1.4B less ETH on the market, maybe price go up?”

Either way, stay safe. Don’t assume any multi-sig fortress is unhackable. And if you do happen to discover the hackers’ stash, maybe collect that sweet $140M bounty and retire on a beach.

Stay degen, stay paranoid, and remember: If you see your entire wallet drained, it might not just be “a glitch.”
— The DegenDen Team

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