Bybit has suffered a loss of approximately $1.46 billion in Ethereum (ETH) on February 21.
Blockchain investigator ZachXBT was the first to spot suspicious outflows from Bybit’s wallets before the news spread among crypto enthusiasts and Bybit exchange users.
The scheme involved the conversion of mETH and stETH tokens to ETH through decentralized exchanges.
How the Bybit Hack Happened
The attackers employed a sophisticated “musked” transaction method, presenting Bybit’s team with a convincing user interface that mimicked legitimate transactions.
They displayed authentic-looking Safe wallet management platform credentials, complete with correct address information and URL verification.
Once Bybit’s team authorized what appeared to be routine transactions, they unknowingly signed malicious code that altered the smart contract logic of the targeted cold wallet. This process granted attackers unrestricted access to the wallet’s Ethereum holdings.
Bybit CEO Ben Zhou confirmed the security breach, stating that hackers had accessed the exchange’s Ethereum multi-signature cold wallet.
However, he reassured consumers that the hack was limited to Bybit’s Ethereum cold wallet, saying,
“Please rest assured that all other cold wallets are secure. All withdrawals are NORMAL.”
An Unexpected Turn: ETH Bridged to SOL
Shortly after, the hacker began bridging ETH to SOL with $245 million stETH sold so far. The Solana coins have been distributed across more than 53 wallets.
The event has intensified discussions about the security of centralized exchanges. Because of the massive quantities of bitcoin on the networks, they continue to be a prime target for hackers.
The hack emphasizes the need for greater transparency and improved security systems.
However, events of this kind might force consumers to use non-custodial wallets and decentralized exchanges (DEXs) to keep control of their assets.
Moreover, the event could lead to more rigorous security requirements and more frequent regulatory scrutiny of exchanges.
Users are advised to exercise caution. If concerned, consider moving funds to cold storage and stay informed through official updates from Bybit and relevant authorities.
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