The Bybit hack has officially become the largest crypto heist ever, with about $1.4 billion in digital assets drained from the exchange. based on our previous reports, hackers exploited Bybit’s multi-signature approval process, deploying a fake user interface to conceal a malicious smart contract, effectively bypassing security measures.
Since the breach, investigators, cybersecurity firms, and bounty hunters have been working tirelessly to track and freeze the stolen funds. 77% of the funds remain traceable, but time is running out as hackers attempt to move assets across decentralized networks and OTC markets.
$1B in Stolen ETH Already Converted Into Bitcoin
Hackers didn’t waste any time laundering their loot. According to Bybit CEO Ben Zhou, 417,348 ETH (worth ~$1 billion) has already been converted into Bitcoin and spread across 6,954 wallets, averaging 1.71 BTC per wallet.
Ben Zhou warned:
“The next seven days are critical. Hackers will attempt to move the funds through centralized exchanges, OTC desks, and P2P networks. Immediate action is needed to freeze stolen assets.”
With decentralized platforms offering anonymity, tracking the funds before they vanish into the blockchain abyss will be a race against time.
THORChain Processed $900M in Stolen Funds—But They’re Still Traceable
A massive $900 million worth of stolen ETH was moved through THORChain, making it one of the key platforms in laundering the stolen funds. While decentralized, cross-chain protocols like THORChain offer greater anonymity, the transactions remain traceable. However, the hackers are now attempting to further obfuscate the funds through additional swaps and mixers. Will regulators and on-chain investigators be able to track and freeze these assets in time?
- 361,255 ETH (~$900M) was swapped through THORChain, making it the largest facilitator in this laundering operation.
- Despite THORChain’s decentralized nature, on-chain analytics reveal that these funds are still traceable.
- The hackers diverted an additional $100M through OKX Web3 proxy wallets, making recovery even more complicated.
Blockchain investigator ZachXBT commented:
“Despite sophisticated laundering attempts, a significant portion of the stolen funds is still within reach if exchanges cooperate.”
Investigators are now pushing for exchanges and DeFi platforms to freeze stolen assets before they move further into anonymous networks.
Bybit Ramps Up Recovery Efforts—$2.18M Paid in Bounties
Bybit is going all-in on fund recovery, launching a real-time tracking website and offering bounties to those who help recover the stolen assets.
Recovery efforts include
- A dedicated blockchain tracking system to monitor hacked funds
- $2.18 million in bounties paid to investigators who have identified suspicious wallets.
- Collaboration with 11 crypto security firms to locate and freeze stolen assets.
However, not all exchanges are cooperating. Seven major crypto platforms have frozen assets, but one exchange, eXch, has refused to comply, stating that it does not facilitate illicit transactions.
Chainflip Moves to Block Hackers With Emergency Upgrade
In response to the Bybit hack, cross-chain DEX Chainflip is rolling out a critical security upgrade to block hackers from laundering stolen assets through its platform. The 1.7.10 update introduces enhanced screening tools to flag suspicious ETH and ERC-20 deposits. As the crypto industry faces mounting pressure to crack down on illicit transactions, will more DeFi platforms adopt similar anti-money laundering measures to prevent future heists?
The new 1.7.10 upgrade includes:
- Screening tools to detect and block suspicious ETH and ERC-20 transactions.
- Enhanced verification protocols for broker operators like SwapKit and Rango DEX.
The Chainflip team emphasized:
“Illicit fund flows endanger the protocol and expose liquidity providers to massive risk. We are taking a hard stance against stolen asset transactions.”
As DeFi platforms face increasing scrutiny, more protocols may introduce anti-money laundering measures to curb the rising wave of crypto-related crime.
Expert Insights: Will Bybit Recover the Stolen Funds?
With 77% of Bybit’s stolen $1.4 billion still traceable, experts are debating whether the exchange can successfully recover the funds before they vanish. While blockchain forensics and exchange cooperation offer hope, hackers are rapidly moving assets through decentralized platforms. Analysts weigh in on the challenges of tracking stolen crypto, the effectiveness of bounty programs, and whether this could become another unsolved billion-dollar heist.
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Blockchain security expert Adam Cochran commented:
“With 77% of the funds still traceable, there’s a real chance of partial recovery—but time is running out. Hackers will use every trick in the book to launder these assets.”
Elliptic co-founder Tom Robinson weighed in:
“The challenge is getting centralized platforms to cooperate. Many DEXs and proxy wallets provide an easy escape route for stolen funds.”
Crypto law expert Jake Chervinsky added:
“Bybit’s bounty program is a smart move, but legal intervention will be needed for any real enforcement action.”
Conclusion: Can This Crypto Heist Be Stopped?
The Bybit hack is a defining moment for crypto security. With over $1 billion in stolen assets still traceable, investigators are racing to freeze funds before hackers disappear with them.
While exchanges, DeFi platforms, and bounty hunters work together, hackers are actively moving funds through mixers, OTC desks, and non-compliant platforms. The next few days will determine whether this becomes the biggest recovery effort in crypto history or another billion-dollar crime left unsolved.
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FAQs
1. How much of the stolen Bybit funds are still traceable?
As of March 4, 2025, 77% of the stolen $1.4B remains traceable, while 20% is lost and 3% has been frozen.
2. Where did the hackers move the stolen crypto?
Over $1 billion in stolen ETH has been converted into Bitcoin and spread across 6,954 wallets. A majority was swapped via THORChain and OKX Web3 proxy wallets.
3. What is Bybit doing to recover the stolen funds?
Bybit has launched a real-time tracking website, offered $2.18M in bounties, and is working with investigators to freeze and retrieve funds.
Glossary
THORChain: A cross-chain decentralized exchange that allows seamless swaps between different blockchains.
OTC Desks: Over-the-counter (OTC) trading platforms where large crypto transactions take place off-exchange.
DEX Aggregators: Platforms that combine multiple decentralized exchanges to optimize token swaps.
AML (Anti-Money Laundering): Regulatory measures designed to prevent illicit financial activities.
Multisig (Multi-Signature): A security mechanism requiring multiple approvals for transactions.
References
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