Bybit: 89% of Stolen $1.4B Crypto Still Traceable Post-Hack

Bybit: 89% of Stolen $1.4B Crypto Still Traceable Post-Hack

The crypto industry was left reeling after the largest hack in history on February 21, when Bybit lost over $1.4 billion in liquid-staked Ether (stETH), Mantle Staked ETH (mETH) and other digital assets. Blockchain investigators continue their efforts to freeze and recover these funds, with an astonishing 89% of the stolen amount still traceable.

Blockchain security firms, including Arkham Intelligence, have identified North Korea’s Lazarus Group as the likely culprit behind the Bybit exploit, as the attackers have continued swapping the funds in an effort to make them untraceable. Despite their efforts, over 88% of the stolen $1.4 billion remains traceable, according to Ben Zhou, the co-founder and CEO of Bybit exchange.

The CEO wrote in a March 20 X post: “86.29% (440,091 ETH, ~$1.23B) have been converted into 12,836 BTC across 9,117 wallets (Average 1.41 BTC each),” said the CEO, adding that the funds were mainly funneled through Bitcoin (BTC) mixers, including Wasbi, CryptoMixer, Railgun and Tornado Cash.

The CEO’s update comes nearly a month after the exchange was hacked. It took the Lazarus Group 10 days to launder 100% of the stolen Bybit funds through the decentralized crosschain protocol THORChain, Cointelegraph reported on March 4.

Blockchain security experts are hopeful that a portion of these funds can be frozen and recovered by Bybit. However, decoding transaction patterns through cryptocurrency mixers remains the biggest challenge in tracing these funds, Bybit’s CEO wrote.

Bybit has already paid out $2.2 million for “bounty hunters” who can provide valuable information on the Lazarus Group’s transaction patterns related to the stolen funds. The exchange is offering 10% of the recovered funds as a bounty for white hat hackers and investigators.

“This incident is another stark reminder that even the strongest security measures can be undone by human error,” Lucien Bourdon, an analyst at Trezor, told Cointelegraph. The Bybit attack highlights that even centralized exchanges with strong security measures remain vulnerable to sophisticated cyberattacks.

The Bybit hack is more than twice the size of the $600 million Poly Network hack in August 2021, making it the largest crypto exchange breach to date. As the crypto industry continues to evolve, it's essential for exchanges and investors to stay vigilant and take proactive measures to prevent similar attacks in the future.