While Friday was an absolute bloodbath in the markets, Crypto land was even more of a sh*t show. In short, yesterday proved to be another day, with another “secure” crypto exchange getting completely gutted by hackers. Except this time, it’s Bybit, which just got taken for a record-setting $1.46 billion in what might be the biggest crypto heist in history. 

(Source: Giphy) 

Again, I didn’t say millions, not hundreds of millions, but nearly $1.5 BILLION big ones—gone, like a magician pulling an elephant out of his a$$. However, what’s really interesting about this deal, is that the hackers didn’t even need to break into Bybit’s hot wallet, where withdrawals happen. No, they went straight for a cold wallet—a.k.a., the offline, supposedly ultra-secure vault that crypto exchanges swear up and down is impenetrable. Turns out, it was about as impenetrable as a wet napkin, because within hours, 401,346 ETH (worth $1.4 billion) was zapped into a new wallet, mixed around, and liquidated faster than the Argentinian President, Javier Milei, rugged his own country for $100 million LOL. (Yes, that happened too—look up $LIBRA).

But, but, but… “I thought cold wallets were “safe”?! Yeah, that’s the best part about this and reason number #8,987,567 I don’t mess with crypto. Cold wallets are supposed to be immune to this kind of thing because they’re not connected to the internet. But Bybit just became the prime example that this just ain’t so. Hackers were able to get just deep enough in their infrastructure to drain it—and back up the brinks truck without anyone catching a whiff of the heist. 

(Source: Economic Times) 

Of course, Bybit’s CEO, Ben Zhou, did what every crypto exec does post-hack—damage control via X. He reassured everyone that "all other wallets are fine" and that Bybit is "solvent", meaning customers won’t lose funds even if the stolen money isn’t recovered. Which, sure, sounds great—until you realize that if $1.46 billion can disappear overnight, maybe the entire concept of crypto security is a joke.

Naturally, Ethereum prices took a 4% nosedive after the hacker dumped $200 million worth of staked ETH (stETH) onto decentralized exchanges. At last check, ETH was down 2.4% to $2,668, which isn’t catastrophic, but it’s yet another reminder that crypto is still the Wild West, and the outlaws are continuously winning. 

(Source: Giphy) 

But the real question now, isn’t if this will happen again—it's who were the degenerate geniuses that pulled this off? Well, according to recent reports, the suspect is looking like North Korea’s Lazarus Group—the state-sponsored hacking syndicate that’s been robbing crypto exchanges blind since 2017. Analysts at Elliptic and Arkham Intelligence have already traced the stolen funds bouncing between wallets, and wouldn’t you know it? The same laundering patterns used in previous Lazarus attacks are showing up.

Meaning, if this is indeed Kim Jong-un’s favorite cybercriminal crew, then congrats to Pyongyang—they just scored enough to fund their nuclear program for another year. Greaaat. As for Bybit though, they’ve apparently secured a bridge loan to cover any unrecoverable losses. Translation: some deep-pocketed backers just cut a check to keep this disaster from turning into a full-blown bank run.

(Source: NBC News) 

And while that does help (to some extent), let’s not look past the fact that this is a PR nightmare for the books. Users are already rushing to withdraw whatever funds they still have on the platform, and you can’t blame them. Trust is everything in crypto, and when a “secure” exchange loses enough money to buy an entire Fortune 500 company, that trust evaporates faster than my dreams of another Dallas Cowboy superbowl win in the near future. 

So with that, if this billion dollar hack tells us anything, it’s this: If a cold wallet can be hacked, NOTHING is safe. But hey, this is crypto we’re talking about. Bybit says they’re fine. They say withdrawals are “normal.” They say they’ll recover. But if history has taught us anything, it’s that crypto traders have the memory of a goldfish—they’ll panic for a few days, then move on to the next shiny thing that promises “decentralization and riches”. 

(Source: Giphy) 

In the meantime, keep an eye on this story if you have any affiliation with crypto and place your bets accordingly. This truly is the wild wild west, and if you aren’t Cowboy enough to keep up and protect yourself—it may be best to ride off into the sunset while you still can. As always, stay safe and stay frosty, friends! Until next time… 

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Stocks.News does not hold positions in companies mentioned in the article.