A large-scale hack on crypto exchange Bybit hack resulted in a reported $1.4 billion being stolen, with roughly 28% now considered untraceable. The attackers, said to be affiliated with North Korea’s Lazarus Group, used sophisticated laundering methods with privacy-centric mixers and cross-chain protocols to cover up the stolen funds.
Such obfuscation techniques are making it almost impossible to recover the funds, prompting grave questions about crypto security and compliance practices.
Breaking Down How the Hack Happened and How the Money Flowed
The theft included about 500,000 ETH, according to Zhou’s executive report. Though 68.57% of the stolen tokens remain identifiable via blockchain records, 27.59%—valued at more than $380 million — has vanished into privacy-enhancing platforms and will likely never be recovered.
A further 3.84% of the assets have been frozen, presumably as a result of actions of law enforcement or blockchain compliance teams. The laundering process involved a web of decentralized mixers and swapping protocols, including Wasabi, Tornado Cash, and Railgun.
The attackers also employed cross-chain bridges, including Thorchain, eXch, Stargate, and SunSwap, to transfer Ethereum into Bitcoin and then transfer the funds between wallets.
Tens of Thousands of Wallets with Laundered Assets
Out of the stolen 500,000 ETH, around 432,748 ETH worth approximately $1.21 billion were swapped into Bitcoin through Thorchain Of this, 342,975 ETH (approximately $960 million) was converted to 10,003 BTC, distributed across over 35,000 unique wallets.
Each of these wallets contained an average of 0.28 BTC, a scheme that is considered to be designed to evade identification by blockchain analysis programs.
Moreover, around 944 BTC (approximately $90 million) was sent to the Wasabi Mixer, and then a further 531 BTC was reversed again into ETH via Thorchain. The process of mixing assets and performing repeated conversions complicates the investigation process right down to a small channel.
Bybit’s Bounty Program for the Community
After Bybit hack, it implemented an aggressive bounty program to crowdsource help in tracing the stolen funds. More than 5,400 reports were filed in a two-month period; 70 were considered actionable. Already, rewards of more than $2 million have been distributed, including a significant reward to Mantle Network for their role in freezing $42 million in stolen crypto.
“We need more bounty hunters in particular with real experience against mixer decryption,”
CEO Zhou said in a statement calling for continued cooperation from the crypto community.
The initiative demonstrates the increasing necessity of decentralized efforts to boost security and the value of community involvement in tracking illicit monetary transactions made in digital formats.
Ethereum Market Overview and Price Prediction
According to YCharts, the Ethereum (ETH) price was $1,607.71 on April 22, 2025. Ethereum (ETH) is one of the most volatile digital currencies, thanks to the continued growth of other types of digital assets. The daily ranges point to support at $1,558 and resistance around $1,650, while trading volumes remain stable on major exchanges.
Ethereum Price Forecasts for 2025
| Analyst/Source | ETH Prediction (USD) |
| Binance | $1,585–$1,577 |
| NewsBTC | $2,700 |
| Benzinga | $4,054–$6,000 |
According to Reddit analysts, these forecasts are driven by factors like improvements in network scalability, institutional interest, and broader integration with DeFi. Nonetheless, persistent security incidents such as the recent Bybit hack still impact investor sentiment and regulatory scrutiny.
Implications for Cybersecurity and Crypto Infrastructure
The Bybit hack exploit highlights the ongoing susceptibility of crypto platforms to advanced hacking campaigns. The laundering of funds through decentralized tools highlights the importance of having proper monitoring systems in place and good cooperation between exchanges, law enforcement, and blockchain analytics firms.
Experts believe that regulatory bodies will use this incident to guide the implementation of stricter Know Your Customer (KYC) and Anti-Money Laundering (AML) protocols for digital finance.
Conclusion
The fact that more than $380 million in stolen funds from the Bybit hack are now out of reach further emphasizes the immediate need for enhanced cybersecurity protocols in the crypto industry.
With investigations ongoing, the exchange’s dependence on community-driven tracing efforts illustrates the challenges behind decentralized crime-fighting in a primarily pseudonymous financial ecosystem.
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FAQs
1. What was the cause of $1.4B hack at Bybit?
The breach was attributed to the Lazarus Group, which utilized crypto mixers, cross-chain swaps, and laundering tools to steal and obscure stolen Ethereum assets.
2. What percentage of the stolen crypto is untraceable today?
About 28 percent — about $380 million — is lost to privacy tools and mixers that are virtually impossible to trace or recover, investigators say.
3. What is Bybit doing to reclaim or recover the stolen funds?
Bybit introduced a bounty program and received more than 5,400 reports and works with law enforcement to freeze and trace stolen funds.
4. And what do consumers need to know now following this security incident?
As Bybit strengthens its security and investigates lingering vulnerabilities across its systems, users might face trust issues, earnest withdrawal checks, or delays.
Glossary of Key Terms
1. Crypto Mixer
A tool that mixes cryptocurrencies from multiple sources to obscure transaction trails, typically used to launder stolen or illicitly obtained digital assets.
2. Cross-Chain Swap
A way for users to swap tokens between disparate blockchains, without going through a centralized exchange, often tapped by hackers to avoid law enforcement.
3. Lazarus Group
A North Korea-linked cybercriminal group with links to cyberattacks targeting financial institutions, particularly in the areas of cryptocurrency theft and money laundering operations.
4. Ethereum (ETH)
A distributed blockchain system for smart contracts and decentralized applications (dApps). It was the main cryptocurrency stolen during the Bybit security breach.
5. Over-the-Counter (OTC) Exchange
A private exchange method for large crypto transactions outside conventional exchanges. Commonly used to convert crypto into fiat without rousing regulatory red flags.
6. Blockchain Tracing
The forensic tool used to trace the flow of digital assets through blockchain networks. It is essential for gaining access back to stolen crypto assets.
7. Bounty Program
A program that companies offer in exchange for financial compensation for individuals reporting bugs or security risks. Bybit leveraged this to track stolen funds following the hack.
