The Article Tells The Story of:
- Historic Heist: Bybit suffered a record-breaking $1.4B crypto theft, likely orchestrated by North Korea’s Lazarus Group.
- Stealth Laundering: Hackers swiftly converted 90% of stolen Ethereum into Bitcoin, spreading funds across 4,400 wallets.
- Untraceable Mixers: The second laundering phase hides Bitcoin origins through crypto mixers.
- Hope for Recovery: Investigators race against time as Bybit offers a $140M bounty.
How Bybit’s Historic Crypto Theft Unfolded
Bybit, a popular cryptocurrency exchange, faced the largest crypto theft in history on February 21. Hackers stole around $1.4 billion worth of Ethereum (ETH) in what is believed to be one of the biggest digital heists ever recorded. The attack targeted one of Bybit’s wallets, compromising 401,346 ETH.
Security researchers, along with the FBI, have linked the breach to the North Korean government, making it a highly sophisticated cyberattack. North Korea’s Lazarus Group, a notorious hacking group, is suspected of orchestrating the theft. This group has been responsible for several major crypto thefts in recent years, financing the country’s weapons programs through stolen digital assets.
Check Out Our Article of $1.4 Billion Stolen in Bybit Hack – Largest Crypto Heist in History Published on February 22, 2025 SquaredTech
How Hackers Laundered Bybit’s Stolen Crypto
After the heist, the hackers moved the stolen Ethereum across various crypto wallets to avoid detection. Blockchain monitoring firms like Elliptic, TRM Labs, and Chainalysis have been closely tracking these transactions.
According to experts, the hackers converted around 90% of the stolen funds into Bitcoin (BTC). The funds were distributed across approximately 4,400 different addresses. The remaining 10% was either lost to transaction fees, frozen, or converted to cash through off-ramp services.
The laundering process involved the use of THORSwap, a decentralized exchange that allows users to swap assets across blockchains without third-party interference. This method helps hide the trail of stolen funds. Additionally, the hackers used CoinJoin services, a method that mixes multiple crypto transactions to obscure their origins.
The speed of these transactions has surprised many cybersecurity experts. It highlights the growing sophistication of cybercriminal networks and their ability to bypass traditional anti-money laundering measures.
Challenges in Recovering the Stolen Funds
Investigators believe the hackers are now entering the second phase of laundering. They have begun depositing portions of the converted Bitcoin into crypto mixers. These services blend cryptocurrency from different users, making it harder to trace its origins.
While some of the stolen funds may be recovered if they pass through crypto exchanges that can freeze suspicious assets, the high volume of money poses a challenge. The hackers’ speed and efficiency have made tracking efforts more difficult.
Crypto mixers typically handle only a few million dollars a day, making it unclear whether they can process such a large sum without raising red flags. However, some underground financial networks in China may help process the stolen funds through off-chain transactions.
Bybit has offered a $140 million bounty for information leading to the freezing of stolen funds. So far, the exchange has paid out $4.3 million to 19 bounty hunters who helped trace the money.
Check Out Our Article of Bybit Offers $140 Million Bounty After Record-Breaking $1.4 Billion Crypto Heist Published on February 24, 2025 SquaredTech
Future Implications
This historic theft raises concerns about the security of cryptocurrency platforms. It highlights the urgent need for stronger anti-money laundering regulations and better security protocols in the crypto industry. Governments and regulatory bodies worldwide are likely to tighten crypto regulations to prevent such large-scale thefts in the future.
Despite the hackers’ sophisticated methods, experts remain hopeful that some of the stolen funds will be recovered. Blockchain technology allows for transparent tracking of transactions, giving investigators a chance to follow the money trail.
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