Hackers, allegedly linked to North Korea’s Lazarus Group, exploited a weakness in Bybit’s multisig cold wallet system. They drained 401,346 ETH, worth about $1.13 billion, from the platform’s hot wallet. The breach caused Bybit’s total reserves to drop by $5.2 billion, raising concerns about its financial stability.
Bybit moved quickly to secure emergency funding. On-chain data showed that deposits and withdrawals returned to normal soon after the attack. Now, Zhou has confirmed that Bybit’s ETH holdings are fully backed at a 1:1 ratio with client assets.
The exchange plans to release an audited Proof-of-Reserves (POR) report soon. The report, using a Merkle tree system, will offer transparent proof of Bybit’s financial standing.
To restore reserves, Bybit secured 446,870 ETH from various sources. This included loans, whale deposits, and direct purchases. Bitget loaned 40,000 ETH, MEXC provided 12,653 stETH, and other contributions came from DWF Labs, Mirana Ventures, and possible Fenbushi Capital backing.
Bybit has also launched a bounty program, offering up to 10% of any recovered assets as a reward. If the full $1.13 billion is retrieved, participants could earn up to $140 million.
Despite Bybit’s quick recovery, Ethereum’s price remains volatile. ETH is currently trading at $2,731, down 2% in the past 24 hours.
