Ethereum Price Plummets Following Bybit's $1.4 Billion Hack

In a shocking turn of events, cryptocurrency exchange Bybit has confirmed a massive security breach involving its Ethereum cold wallet, resulting in the unauthorized transfer of approximately $1.4 billion worth of assets. This incident has sent ripples through the crypto market, causing Ethereum's price to dip significantly.

Key Takeaways

• Bybit confirmed a hack involving its ETH cold wallet, leading to a loss of $1.4 billion.

• The attack manipulated a transaction during a transfer from a multisig cold wallet to a warm wallet.

• CEO Ben Zhou assured users that client funds are safe and operations continue as normal.

Details of the Hack

On February 21, 2025, Bybit's CEO Ben Zhou announced on social media that the exchange's ETH multisig cold wallet was compromised during a planned transfer to a warm wallet. The attacker executed a sophisticated maneuver that masked the signing interface, allowing them to alter the smart contract logic and gain control of the wallet.

The breach resulted in the unauthorized transfer of:

• 401,347 ETH valued at approximately $1.12 billion

• 90,376 stETH worth $253.16 million

• 15,000 cmETH valued at $44.13 million

• 8,000 mETH totaling $23 million

Market Reaction

Following the announcement of the hack, Ethereum's price experienced a sharp decline, dropping by about 5% to $2,675. However, it has since rebounded slightly to around $2,766. The incident has raised concerns among investors, leading to increased scrutiny of security measures at cryptocurrency exchanges.

Bybit's Response

In the wake of the breach, Bybit has mobilized its security team and is collaborating with blockchain forensic experts to investigate the incident thoroughly. The exchange has also invited other teams with expertise in blockchain analytics to assist in tracing the stolen assets.

Ben Zhou reassured users that all other cold wallets remain secure and that client funds are backed on a one-to-one basis. He emphasized that operations, including withdrawals, are unaffected by the incident, stating, "The only cold wallet that was hacked was the ETH cold wallet."

Conclusion

The Bybit hack serves as a stark reminder of the vulnerabilities that exist within the cryptocurrency space. As exchanges continue to grow in popularity, the need for robust security measures becomes increasingly critical. Investors are advised to remain vigilant and consider the security practices of the platforms they use for trading and storing their digital assets.

Sources

• Ethereum Price Dips After Bybit Reports Massive $1.4 Billion Hack | Bitcoinist.com, Bitcoinist.com.

• Ethereum Falls as Crypto Exchange Bybit Confirms $1.4 Billion Hack - Decrypt, Decrypt.