A group of hackers just pulled off the largest cryptocurrency heist in history, looting an estimated $1.4 billion from the Bybit exchange.
The hackers compromised an offline “cold wallet” that stored Ethereum, stealing the 400,000 in ETH on Friday morning, Bybit CEO Ben Zhou told users in a live stream.
During the incident, the cold wallet was supposed to transfer funds to an online “hot wallet.” To execute the transaction, the cold wallet required approval from multiple private keys.
“Unfortunately, this transaction was manipulated through a sophisticated attack that masked the signing interface, displaying the correct address while altering the underlying smart contract logic,” Bybit said in a tweet. “As a result, the attacker was able to gain control of the affected ETH cold wallet and transfer its holdings to an unidentified address.”
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The statement suggests the hackers gained remote access to computers at the exchange. Bybit is still determining how the breach occurred, but the amount lost far surpasses the previous record-holder for biggest crypto heist. In 2022, Ronin Network lost $620 million in Ethereum and USD Coin, allegedly at the hands of North Korea’s Lazarus group.
Bybit has recruited cybersecurity companies to help it investigate the breach. This includes tracking where the stolen funds are being transferred by monitoring the Ethereum blockchain.
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In the meantime, Bybit’s CEO is telling the public: “I want to reassure, for clients, all the users of Bybit, that your money is safe,” citing its currency reserves.
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“Bybit has overall $20 billion in client’s assets,” he added. “If we unfortunately cannot recuperate any of this money, the Bybit exchange will cover it through our treasury.”
Despite the breach, the exchange is continuing to allow users to withdraw their funds in Bitcoin. Once it receives a loan, Bybit then expects to resume withdrawals for Ethereum.
“We’ve experienced a massive withdrawal (in ETH),” he added. “But we have passed the peak.” News of the hack has since caused the value of Ethereum to fall from $2,823 down to $2,685.
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About Michael Kan
Senior Reporter
