Key Takeaways
- Bybit CEO Ben Zhou hints at launching a new recovery tool to help the industry track and reclaim stolen funds.
- Hackers behind the Bybit exploit have laundered over $250 million worth of Ethereum in just four days.
- Crypto exchanges and stablecoin issuers have collectively frozen $85 million in stolen assets.
Bybit CEO Ben Zhou has announced that the company is working on a new tool designed to help the crypto industry combat hacks and recover stolen funds.
The announcement comes just days after Bybit suffered a massive security breach, with hackers siphoning $1.5 billion from the exchange’s cold wallet.
While details about the recovery tool remain sparse, Zhou said it would be released “in the next few days” and aims to provide a more effective way for crypto platforms to track and reclaim stolen assets.
Exchanges Freeze $85 Million as Laundering Efforts Escalate
Following the Bybit hack, crypto exchanges and stablecoin issuers stepped in to mitigate further damage.
On Feb. 23, multiple platforms froze $42.5 million in stolen funds, preventing the hackers from moving those assets.
A day later, the mETH Protocol team successfully recovered 15,000 cmETH tokens, valued at approximately $43 million.
Despite these efforts, the hackers have been quick to launder their remaining holdings.
Crypto criminals often use mixers, decentralized exchanges, and cross-chain swap protocols to obscure the origin of stolen funds.
However, in Bybit’s case, the exploiters are leveraging a mix of both centralized and decentralized avenues to move their assets.
Hackers Move 100,000 ETH in Days
Since the breach on Feb. 21, the attackers have laundered 100,000 ETH—roughly $250 million—at an unprecedented pace, accounting for 20% of the total stolen amount.
Several blockchain security analysts, including ZachXBT, have linked the exploit to the North Korean-affiliated Lazarus Group, which is known for orchestrating some of the biggest crypto heists in history.
Unlike their previous laundering strategies, which involved waiting months or even years before moving stolen funds, the Bybit hackers have acted swiftly.
Over the past four days, they have executed rapid-fire transfers, often making two to three transactions per minute.
By continuously splitting funds across multiple wallets and changing addresses with each transaction, the attackers create the illusion of routine activity, making it harder for investigators to trace their movements.
Additionally, the hackers have been using THORChain to convert stolen ETH into Bitcoin, DAI, and other altcoins through cross-chain swaps.
Hackers Still Hold Nearly $1 Billion in Stolen ETH
Despite their aggressive laundering strategy, the hackers still control 399,000 ETH—worth approximately $996 million—making them one of the largest single holders of Ethereum.
At present, they have more ETH in their possession than Ethereum co-founder Vitalik Buterin or even the Ethereum Foundation.
At press time, Buterin held 240,000 ETH, while the Ethereum Foundation held 223,000 ETH.
Bybit’s recovery tool could aid the industry’s ongoing battle against cyber criminals.
However, whether it will be enough to disrupt sophisticated laundering operations remains to be seen.
Prashant Jha is a seasoned crypto journalist based in Delhi, India, with a Bachelor’s Degree in Computer Science Engineering. Passionate about the evolving world of blockchain and cryptocurrencies, he has been a dedicated voice in the industry since 2018. Prashant’s expertise lies in regulatory reporting, where he unravels complex legal and financial developments with clarity and precision. Before joining CCN in 2024, he honed his craft at Cointelegraph, establishing himself as a trusted name in crypto journalism.
His coverage spans major industry events, including the high-profile collapses of FTX, Three Arrows Capital (3AC), and LUNA, offering readers insightful analyses of their regulatory and market implications. Prashant’s technical background enables him to bridge the gap between intricate blockchain technology and its real-world applications, making his work accessible to novices and experts.
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