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As someone with deep experience in cross-chain crypto exchanges within Telegram mini-apps, I’d like to share my insights on the current state of crypto security and key measures to prevent cyber attacks.

The recent hack of the Bybit Exchange on February 21, 2025, has once again highlighted the significant impact of cyber attacks on the cryptocurrency market.

This incident – which resulted in the theft of approximately $1.5 billion worth of Ethereum (ETH) – stands as the largest digital heist in cryptocurrency history.

Let’s examine some interesting statistics and data surrounding cyber attacks in the crypto space and their consequences.

Scale and frequency of attacks and market impact

The Bybit hack is part of a worrying trend of increasing cyber attacks on cryptocurrency platforms.

In 2024, North Korea-linked hackers alone stole approximately $1.34 billion in 47 incidents, a 102.9% increase from the $660.5 million stolen in 20 incidents in the previous year.

The Bybit hack in 2025 has already surpassed the entire amount stolen by North Korea in 2024 by nearly $160 million.

The immediate market reaction to the Bybit hack demonstrated the volatility that such incidents can cause, including the following.

• ETH dropped 4.2% from $2,828 to $2,708 within minutes of the announcement.
• A brief rebound of 3.4% followed, bringing the price back to $2,759.

The initial drop in the ETH price was followed by a quick rebound, fueled by speculation that Bybit would have to buy back ETH on a one-to-one basis to compensate affected users.

Bybit has secured a bridging loan for 80% of the lost ETH, as clarified by Ben Zhou, co-founder and CEO of Bybit, during a live stream.

He also stated that Bybit had no immediate plans to buy large amounts of ETH on the spot market.

This news caused a rapid shift in market sentiment from bullish to bearish, due to concerns that the hacker would sell the stolen ETH and a general increase in risk aversion among investors.

Types of cyber attacks

While previous major hacks have often targeted vulnerabilities in smart contract code or cross-chain bridges, the Bybit incident represents a shift towards targeting the human element.

• The attackers used social engineering tactics to compromise the exchange’s user interface.
• They manipulated cold wallet signatories to authorize malicious transactions.

This trend is consistent with research showing a shift from traditional security attacks to more sophisticated methods.

In terms of the amount stolen by type of victim platform, 2024 also showed interesting patterns.

In most quarters between 2021 and 2023, DeFi (decentralized finance) platforms were the main targets of crypto hacks.

It’s possible that DeFi platforms were more vulnerable because their developers tend to prioritize rapid growth and getting their products to market over implementing security measures, making them prime targets for hackers.

Although DeFi still accounted for the largest share of stolen assets in Q1 2024, centralized services were the most targeted in Q2 and Q3.

This shift in focus from DeFi to centralized services highlights the increasing importance of security mechanisms commonly exploited in hacks, such as private keys.

Private key compromises accounted for the largest share of stolen crypto in 2024 – at 43.8%.

For centralized services, ensuring the security of private keys is critical as they control access to users’ assets.

User education – A critical component

While exchanges bear significant responsibility for security, user education plays a critical role. Comprehensive education initiatives should equip users with the knowledge to do the following.

• Create and manage strong, unique passwords
• Recognize social engineering tactics and phishing attempts
• Understand the importance of regular backups

In conclusion, the Bybit hack is a stark reminder of the ongoing security challenges in the cryptocurrency space. As the market continues to grow, so too will the methods used by hackers.

It is imperative that the industry stays ahead of the curve by adopting advanced technologies, fostering collaboration and continuously educating users.

By implementing comprehensive security measures and remaining vigilant, we can work towards creating a safer environment for all participants in the crypto ecosystem.

Valeriy Yasakov is the CEO of The One, a pioneering mini app on Telegram designed for crypto trading. A visionary entrepreneur, Valeriy combines technical expertise with strategic foresight to drive advances in decentralized financial and trading solutions through his leadership roles.

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Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.

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Following the hack, Back took to X on February 22 to describe the technology as “complex, fragile, and blind-signed”.

“Another day, another EVM contract hack”, he wrote in another post, adding that billions have been lost over the years due to these issues.

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Back believes these security failures damage trust in the crypto industry, including Bitcoin
BTC


$94,560.89

He said in a February 24 post on X, “People are misunderstanding critique of repeated EVM hacks, the latest and the largest Bybit $1.4 billion missing the point: EVM can go to zero, no one cares. The problem is the EVM dumpster fire hurts ecosystem credibility, which unfairly bleeds over to Bitcoin”.

However, not everyone agrees with this view. Some argue that the Bybit hack was not caused by EVM flaws but rather by poor security measures, especially in handling multi-signature wallets. They point out that strong operational security can prevent such breaches, regardless of the underlying technology.

Back countered that Ethereum’s transaction verification process is fundamentally flawed. He explained that hardware wallets are supposed to confirm transaction details on-screen before approval, but EVM’s complexity makes this difficult.

He also noted that in Bybit’s case, addresses did not appear on hardware wallet screens, which made verification nearly impossible.

Meanwhile, Elliptic reported on the process used by the Lazarus Group, the hackers behind the Bybit hack, to cover their tracks. How? Read the full story.

This mass exodus of funds followed a $1.4 billion exploit on Feb. 21, triggering widespread panic among users.

Data from DeFiLlama reveals that Bybit processed $2.5 billion in withdrawals on Feb. 22 and another $3.26 billion on Feb. 23. The rapid outflows caused the exchange’s total assets to shrink from $16.9 billion to $10.8 billion as of press time.

Stablecoins and Bitcoin were the most withdrawn assets, with users pulling over $2.3 billion in USDT and more than $1.5 billion in BTC.

Despite the rapid outflows, Bybit managed to process withdrawals without major disruptions. Crypto analyst Sani noted that while a significant portion of Bitcoin withdrawals appeared to be routine customer transactions, large sums were transferred to Binance and OTC platforms.

This has raised questions about whether Bybit sold Bitcoin or used it as collateral to secure Ethereum and cover withdrawals.

However, the firm’s CEO, Ben Zhou, reassured users that the exchange had resolved its Ethereum shortfall and that client assets remain fully backed on a 1:1 basis.

The post Bybit’s reserves plunge by $6 billion in two days after exploit appeared first on CryptoSlate.

The incident, reported on Friday by Bitcoinist, marks one of the largest cryptocurrency hacks in history, with losses estimated at over $1.5 billion.

Bybit Hack Linked To North Korea’s Lazarus Group

According to Bybit, the breach occurred during a transfer from their ETH multisig cold wallet to a warm wallet. The exchange revealed on social media platform X (formerly Twitter) that the attack was executed through a “sophisticated manipulation” of the transaction process. 

This manipulation allowed the hacker to mask the signing interface, which displayed the correct wallet address while altering the underlying smart contract logic. 

Subsequently, on-chain market intelligence firm Arkham Intelligence revealed that crypto sleuth ZachXBT has provided compelling evidence linking the hack to the notorious Lazarus Group, a North Korea-backed hacker organization. 

In his detailed analysis, ZachXBT reportedly submitted findings that included test transactions, associated wallets, forensic charts, and timing analyses. This information has been shared with Bybit to assist in its ongoing investigation.

$1.44 Billion In Misappropriated Assets

The scale of the breach is staggering. Estimates suggest that approximately 401,347 ETH, valued at around $1.12 billion, were withdrawn. 

Additionally, other assets lost in the hack include 90,376 stETH worth $253.16 million, 15,000 cmETH valued at $44.13 million, and 8,000 mETH totaling $23 million. The total estimated loss stands at approximately $1.44 billion.

In light of this incident, Bybit has activated its security team and is collaborating with leading blockchain forensic experts to conduct a thorough investigation. 

The exchange has also reached out to other teams with expertise in blockchain analytics and fund recovery, inviting them to assist in tracing the misappropriated assets.

It remains to be seen what further action Bybit will take with the information provided by ZachXBT and how the case will unfold regarding the misappropriated customer funds. 

As for ETH’s price, the second largest cryptocurrency on the market has seen a 4% retracement towards $2,640 just hours after the security breach. 

Featured image from DALL-E, chart from TradingView.com