The digital currency sector heads into a new week plagued by fears of turbulence after Bybit had more than $1.4bn worth of cryptocurrency stolen from its exchange.
It was first reported by blockchain analyst ZachXBT, who reported “suspicious outflows”, following major withdrawal volume from one specific user.
Further triggering the fear of unscrupulous activity was the transferring of 400,000 ETH ($1.1bn) to an unidentified address.
The hacking focused on ETH, with the currency penetrating a plethora of cold wallets before being liquidated to be sold on decentralised exchanges.
Bybit CEO Ben Zhou stated that the situation had stabilised by Sunday, however, 70% of the platform’s ETH had been withdrawn, causing the company to secure a loan to process the transactions.
In spite of the turbulence, Bybit took steps to mitigate the impact of the hack, ensuring that user reserves were guarantee-backed, as well as cementing assurance around client assets.
The firm also strengthened security protocols as soon as it became aware of the infringement and took rapid action to steady the ship.
Bybit’s internal and external task forces confirmed the blockchain addresses that traced the attack.
In a bid to strengthen security in the sector and reassure digital currency users globally, the exchange also revealed that it will continually update the list of addresses to partnering crypto security firms to prevent any possible further attacks, while rewarding successful interceptions with a 10% bounty.
This collaborative approach from both Bybit and the crypto sector was praised by Zhou as he remained positive over the future of crypto crime defences for the future.
He stated: “I am energised by the incredible camaraderie on-chain and in real life. This can be a transformative moment for our industry if we get it right. Together, we can build a stronger defense system against cyber threats.”Whilst the threat of hacks will serve to diminish the appetite from many for crypto engagement in iGaming, the speed and effectiveness of the Bybit response underlines the evolution of approach from the digital currency sector.
