Bybit, a major cryptocurrency exchange, has been the victim of a significant hack, resulting in the theft of over $1.4 billion in Ethereum and ERC-20 tokens, causing alarm in the crypto market.
How the Hacker Exploited Bybit’s System
The Bybit hack involved replacing a legitimate smart contract with a malicious one. This new contract had hidden functions, allowing the hacker to withdraw ETH undetected. Blockchain security firm SlowMist found that the hacker used 'sweepETH' and 'sweepERC20' functions to move large amounts of crypto to an unknown wallet. The manipulation was so sophisticated that it initially seemed like a routine transaction.
Bybit CEO Ben Zhou Addresses the Crisis
Ben Zhou quickly responded to the hack, assuring users of Bybit's financial stability. He stated that all client funds are backed 1:1 and that the exchange can cover the losses. Bybit has continued processing withdrawals and deposits without disruption. To recover the stolen funds, Bybit is working with blockchain forensic experts and has requested the crypto community's help in tracking the hacker’s wallet.
Crypto Market Reacts to the Bybit Hack
The Bybit hack had an immediate impact on the crypto market. Following the news, ETH’s price dropped by over 3%, falling below $2,700. Bitcoin also saw a decline, slipping to around $97,000. The market’s reaction highlights the sensitivity of crypto traders to security breaches. Many investors pulled funds from centralized exchanges, fearing similar attacks.
This breach, one of the largest in crypto history, raises important questions about exchange security and the risks of storing funds on centralized platforms. Attention is now focused on how exchanges, including Bybit, will take measures to protect user funds in the future.
