Bybit, a popular crypto exchange, is reeling from the massive hack worth $1.5 billion in digital assets. According to reports, the hackers targeted the crypto exchange’s cold wallet, an offline storage system, to steal the exchange’s assets, primarily Ether. On-chain data reveals that the stolen funds were quickly transferred into different wallets and liquidated on several platforms.

Ben Zhou, Bybit’s CEO, promptly addressed the hack and told users that the site’s other cold wallets are secure and withdrawals are processed “normally”. 

As the company struggles with a surge in withdrawal requests, it received over 88,000 ETH (worth around $239 million) from popular exchanges like Binance and Bitget. The fresh crypto transfers from these two popular exchanges boosted Bybit’s liquidity, allowing it serve the customers’ withdrawal requests.

Bybit detected unauthorized activity involving one of our ETH cold wallets. The incident occurred when our ETH multisig cold wallet executed a transfer to our warm wallet. Unfortunately, this transaction was manipulated through a sophisticated attack that masked the signing…

— Bybit (@Bybit_Official) February 21, 2025

Authorities Link Breach To North Korean Hacking Group

Friday’s hacking of the Bybit cold wallet is considered the biggest crypto hacking on record. Arkham Intelligence and Elliptic said the stolen digital assets were quickly transferred to different accounts and liquidated within minutes. Elliptic reports that the hacking is by far the biggest in the industry and easily surpassed the stolen $570 million from Binance in 2022 and the $611 million worth of crypto assets drained from Poly Network in 2021.

ByBit CEO says the platform is experiencing “massive withdrawals.” https://t.co/Xi5vhqMqWI

— FORTUNE (@FortuneMagazine) February 21, 2025

Elliptic speculated that the Lazarus Group, a state-backed hacking team in North Korea, perpetrated the hack. The Lazarus Group is known for its crypto-hacking activities, stealing billions of dollars from different sites. 

Bybit Gets Help From Binance And Bitget

As Bybit struggled to service the surge of withdrawals, it received help from other popular exchanges to cover the requests. Arkham said the exchange received more than 88,000 Ether or roughly $239 million from Binance and Bitget addresses.

The fund infusion can boost the exchange’s current liquidity as it addresses the massive withdrawal requests. Bybit confirmed that its users moved funds from the exchange after the hack was made public.

Arkham said Bitget transferred 40,000 Ether, or $106 million, to a Bybit cold wallet on February 21st at 19:44 (UTC). Lookonchain argued that Bitget transferred its funds to the exchange to boost its liquidity and serve as a vote of confidence. 

After 10 minutes, a Binance hot wallet transferred 11,800 Ether or $31 million to the same Bybit cold wallet address. In total, Binance has transferred 47,800 Ether or $127.48 million. 

CEO Explains Crypto Exchange Remains Solvent

Bybit’s CEO, Ben Zhou, has assured its users and customers that the exchange is solvent. In a Twitter/X post, the CEO explained that the customers’ funds are backed 1:1 and that the company can service the losses even if it fails to recover them.

Featured image from Adobe Stock, chart from TradingView

VanEck has announced a bold prediction that Bitcoin will play a critical role in managing the United States’ rising national debt. The study, based on Senator Cynthia Lummis’ proposed Bitcoin Act, shows that a strategic Bitcoin reserve may partially balance the country’s debt by 2049. But how feasible is this concept?

The Potential Impact Of Strategic Bitcoin Reserves

The study examines a scenario in which the US government obtains up to 1 million BTC during a five-year period. If this strategy comes to fruition, VanEck believes that such a reserve may help balance almost $21 trillion in national debt by 2049. Based on forecasts of future debt growth, this equates to around 18% of the expected total debt at the time.

However, this positive forecast is heavily reliant on Bitcoin’s price trajectory. VanEck’s model forecasts that BTC will grow at a 25% compounded annual rate (CAGR). Starting with an estimated acquisition price of $100,000 per unit in 2025, the crypto would need to see sustained price increases over the next two decades.

Source: VanEck

Debt Growth Versus Bitcoin Appreciation

The study considers the expected 5% annual rate of increase in US debt trajectory. Any effort to balance the predicted $100 trillion national debt by 2049 will need assets with big appreciation potential.

Though highly volatile, Bitcoin presents both a challenge and an opportunity. A 25% CAGR is an ambitious aim considering past pricing volatility, regulatory uncertainties, and industry acceptance patterns. Should the slow down in the crypto’s expansion, the reserve might not meet expectations, therefore lessening its value in addressing national debt.

Bitcoin As A Government Asset

VanEck’s view is consistent with a broader discussion concerning the leading digital currency’s role in national economies. Countries such as El Salvador have already adopted the top coin into their financial plans, albeit on a far lesser scale. If the US took a similar strategy, it would be an unparalleled shift in monetary policy.

The practicality of building such a massive Bitcoin reserve raises concerns. Would the government buy the crypto asset gradually or in bulk? How would it safeguard and govern such an asset? These uncertainties complicate VanEck’s vision.

A High-Risk Gamble Or A Financial Breakthrough?

VanEck’s research presents an intriguing possibility, despite these obstacles. The potential of BTC as a long-term wealth reserve is still a topic of debate among economists and policymakers. It may be feasible to employ the digital asset to mitigate national debt if its value continues to increase.

For now, the feasibility of this strategy remains uncertain. The US government has yet to indicate any concrete plans to acquire the alpha crypto on a large scale. But with national debt rising and Bitcoin’s influence growing, discussions around this unconventional solution are far from over.

Featured image from Gemini Imagen, chart from TradingView

As Bybit picks up the pieces from its jarring security breach, the Ethereum (ETF) community has been buzzing with speculation over the network’s future. One side of the divide makes a case for a blockchain rollback designed to eliminate malicious transactions, while the purists argue that the move will “kill” Ethereum’s credibility.

Forging Ahead With a Rollback

BitMEX co-founder Arthur Hayes has declared support for a rollback for the top layer 1 network, pitching his tent on the premise of Ethereum’s hard fork in 2016. For Hayes, since the network has undergone a previous hardfork, a rollback to stifle the ability of North Korean hackers to use stolen assets should be an easy choice for validators.

Samson Mow, Jan3 CEO, endorsed the proposed rollback in conversations with Ethereum co-founder Vitalik Buterin. Mow’s theory proposes the $ETH ticker for the rolled-back chain and renaming the current chain $ETHNK, urging Coinbase and other exchanges to delist the token from their platforms.

While the debate rages on, hardliners in the Ethereum community may be swayed by claims that the stolen ETH by state-sponsored hackers will be used to fund North Korea’s nuclear weapon programs. The $1.5 billion pilfered from the Bybit hack surpasses previous security breaches in scale, dwarfing the top five biggest hacks of 2024 by a country mile.

A blockchain rollback is an event that reverses confirmed transactions on a network to a previous state. Traditionally, the concept involves chain deployment after security breaches, and it takes several forms, including forks and chain reorganizations.

Ethereum Community Against The Rollback

Amid the Bybit hack, blockchain proponents in the Ethereum community are adopting a hard stance against a rollback proposal, citing the grim potential of eroding Ethereum’s credibility in the grand scheme.

“A rollback can only happen if you split the chain. Ethereum’s reliability and neutrality would be at risk,” said pseudonymous crypto trader Borovik on X. “This should never happen, under no circumstances.”

Borovik’s argument has received support from Bitcoin proponent Jimmy Song, who notes that the Bybit incident is significantly different from 2016’s DAO hack. Song’s claim against a rollback hinges on the fact that the Bybit hack is a settled affair, while the DAO hack took a month to execute.

“I know people are expecting the Ethereum Foundation to roll back the chain, but I suspect it’s already too much of a mess to do it cleanly,” said Song

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Aliyu Pokima

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.