On February 21, 2025, Bybit, a prominent cryptocurrency exchange headquartered in Dubai, experienced a significant security breach resulting in the theft of approximately $1.4 billion in Ethereum (ETH) and related tokens. The attacker managed to compromise one of Bybit's Ethereum cold wallets, which are typically offline and considered more secure than online wallets. The stolen assets included 401,347 ETH and various staked Ethereum tokens.

Bybit's co-founder and CEO, Ben Zhou, addressed the incident, assuring customers that the exchange remains solvent and that all client assets are backed 1:1. He emphasized that customer withdrawals are functioning normally and that the company can cover the losses even if the stolen funds are not recovered.

The breach has raised concerns within the cryptocurrency industry, highlighting ongoing security challenges. In 2024 alone, over $2.2 billion in funds were stolen from crypto platforms, marking a 21.1% increase from the previous year.

Following the news of the hack, major cryptocurrencies experienced slight declines. Bitcoin fell by 1.4% to around $96,986, while Ether declined by 1.9% to $2,675.

Bybit has stated that its security team, along with external blockchain forensic experts, is actively investigating the incident. The company has also reached out to the broader community for assistance in tracking the stolen funds.

This event underscores the critical importance of robust security measures within the cryptocurrency sector, especially concerning assets stored in cold wallets, which are traditionally viewed as more secure.