Bybit Hit with $1.4B ETH Hack—CEO Confirms Record Withdrawal Surge

• Bybit lost $1.4B in ETH in the largest crypto hack to date, linked to Lazarus Group.
• Over 350,000 withdrawal requests flooded Bybit post-hack; 99.994% processed within hours.

Bybit, one of the world’s largest cryptocurrency exchanges, suffered a $1.4 billion Ethereum (ETH) heist—the largest crypto theft in history. The breach triggered an unprecedented wave of withdrawals, surpassing 350,000 requests within 10 hours. 

Despite the market turmoil, Bybit CEO Ben Zhou reassured users that client funds remain secure. The exchange, backed by its treasury and partner loans, is working with blockchain experts to trace and recover the stolen assets.

Largest Crypto Heist in History Unfolds

On February 21, 2025, hackers infiltrated Bybit’s offline Ethereum cold wallet, siphoning approximately 400,000 ETH. Bybit’s CEO Ben Zhou revealed during a livestream that the breach exploited the wallet’s multi-signature approval process.

Blockchain investigator ZachXBT, along with Arkham Intelligence, linked the attack to North Korea’s Lazarus Group—known for major crypto thefts like the Axie Infinity ($617 million) and Harmony Horizon ($100 million) breaches. Experts, including Rob Behnke of Halborn, described the Bybit incident as potentially the largest digital heist ever recorded.

According to Zhou, the attacker altered the underlying smart contract logic while displaying a legitimate signing message. This allowed them to divert funds to an unidentified wallet. The investigation continues, with cybersecurity firms assisting Bybit in tracking the stolen funds.

Developing updates show that the Lazarus Group is actively laundering the stolen ETH. Bybit founder Ben Zhou confirmed that the hackers are converting the stolen Ethereum into Bitcoin via Chainflip. Blockchain data from Lookonchain indicates the funds were transferred to the wallet address “0x33d0…8F65” before conversion. Notably, the same wallet is linked to the recent $69 million hack of the Phemex exchange. On-chain investigator ZachXBT corroborated that both the Bybit and Phemex breaches were traced back to the Lazarus Group.

Unprecedented Withdrawal Surge Amid Market Turmoil

Following the breach, Bybit experienced its highest withdrawal volume to date. Zhou reported over 350,000 requests within 10 hours, with just 2,100 pending. “The entire team has worked tirelessly to process withdrawals and respond to clients,” Zhou stated. Bybit confirmed that 99.994% of requests were completed, maintaining user access to funds, particularly in Bitcoin.

Since the hack (10 hrs ago) , Bybit has experienced the most number of withdraws that we have ever seen, We have had a total number of more than 350k withdraws requests, so far, around 2100 withdraw requests left to be processed. Overall 99. 994% withdraws have been completed. If…

— Ben Zhou (@benbybit) February 22, 2025

The hack sent shockwaves across the crypto market. Ethereum’s price dropped from $2,823 to $2,685 within hours, while the global market shed over $75 billion. Bitcoin fell 4% from $99,495 to $96,200, partly due to consecutive outflows from Bitcoin ETFs totaling $689.6 million over four days. 

Altcoins like XRP, BCH, and LINK also faced significant losses. Bybit’s efforts to mitigate the impact included allowing Bitcoin withdrawals and planning to resume Ethereum withdrawals once liquidity improves. Zhou confirmed that only one cold wallet was compromised, with all other wallets remaining secure.

Bybit’s Recovery Efforts and Liquidity Boost

Binance and Bitget exchanges have transferred over 50,000 ETH to Bybit to bolster liquidity and restore confidence. Bybit has enlisted top cybersecurity firms to investigate and monitor blockchain activity. While tracing the stolen ETH remains challenging, Zhou assured users that the exchange holds over $20 billion in assets, with enough reserves to cover the loss if recovery fails. Bybit secured 80% of the necessary funds through bridge loans and continues working with forensic teams to locate the stolen assets.

Twelve hours after the $1.4 billion hack, Bybit CEO Ben Zhou confirmed that all withdrawal requests have been fully processed, with the system now operating at a normal pace. Users can withdraw any amount without delays, and Zhou assured a full incident report and security updates in the coming days.

To improve liquidity, Bybit moved 2.95 billion USDT from its cold to warm wallet, clarifying it was a planned action unrelated to the hack. In response to the breach, the broader crypto market experienced heightened volatility, with over $566 million liquidated in 24 hours, according to Coinglass. This panic selling contributed to a 1.98% decline in global crypto market capitalization, bringing it down to $3.17 trillion.

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