The largest hack in cryptocurrency history: Bybit loses $1.4 billion
In February 2025, the cryptocurrency world was shaken by the news of the largest hack in history on the Bybit exchange, which resulted in the theft of over $1.4 billion in Ethereum (ETH). The latest analysis indicates that hackers have already managed to launder over half of these funds using the THORChain protocol.
Details of the attack on Bybit
The attack took place on February 21, 2025, when cybercriminals seized approximately 401,000 ETH from the Bybit exchange's cold wallet. According to reports, the operation was carried out by the North Korean hacking group Lazarus Group, known for previous large-scale cryptocurrency thefts. The FBI has officially confirmed their involvement in the attack.
Cybersecurity experts indicate that the hackers used advanced social engineering techniques and vulnerabilities in the exchange's infrastructure. By taking over key systems, they were able to withdraw funds in record time before the exchange even realized what was happening.
Laundering of stolen funds by THORChain
In just a week since the attack, hackers managed to launder over $605 million in ETH, which is over 54% of the stolen funds. They did this by using the THORChain protocol, which allows for direct exchange of assets between different blockchains, eliminating the need for central exchanges.
THORChain, due to its decentralized nature and lack of KYC, has become an attractive tool for hiding the origin of funds. Hackers would exchange ETH for other cryptocurrencies and then transfer them to different ecosystems, making them difficult to track.
Exchange response and next steps
Despite the massive losses, Bybit assured its users that all customer deposits were safe and the company had sufficient reserves to cover the losses. The exchange immediately partnered with law enforcement and blockchain analytics firms like Chainalysis and Elliptic to recover the stolen funds and hold the perpetrators accountable.
As part of the remediation efforts, Bybit has offered a $140 million reward for information leading to the recovery of the stolen funds.
What does this attack mean for the market?
The attack on Bybit and the subsequent laundering of stolen funds by THORChain underscore the need to strengthen security in the cryptocurrency ecosystem and implement more effective monitoring and anti-money laundering mechanisms.
The cryptocurrency community now faces a huge challenge:
How do you reconcile decentralization and anonymity with security?
Should decentralized protocols like THORChain have mechanisms to mitigate money laundering?
What steps should exchanges take to better protect user funds?
The events of February 2025 will long be remembered in the history of cryptocurrencies as the largest cyberattack on an exchange, showing both the strength and weakness of this industry.
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