The Bybit exchange was hacked, resulting in over $1.4 billion in Ethereum losses. The article discusses preventative measures and the infeasibility of an Ethereum rollback.
The Hack and Its Consequences
After Lazarus stole over 400,000 ETH from Bybit's cold wallet, crypto prices crashed. Bybit CEO Ben Zhou defended the exchange's actions, informing the community. Industry leaders mobilized resources to assist. Despite recovery efforts including a bounty program and on-chain tracking, hackers successfully laundered the funds across thousands of addresses.
Multi-Sig Issues
The incident raised concerns about 'blind' signing, where users approve transactions without full detail verification. Zhou finalized the signature using a Ledger hardware wallet, which led to the breach. However, the system's weaknesses enabled North Korean hackers to exploit access to deceive Bybit signers.
Ethereum Rollback: Options and Challenges
Arthur Hayes proposed a blockchain rollback to restore balances. However, rolling back Ethereum could disrupt numerous protocols and smart contracts. Flynn stated that while technically feasible through a hard fork, a rollback is practically infeasible due to the network's scale and decentralization.
The Bybit hack emphasized the need for reinforced exchange security measures and strategies like asset segmentation and transaction verification improvements. Retrospective blockchain changes remain unlikely following such hacks.
