22-2-2025 – Leading exchange Bybit fell victim to one of the largest digital asset heists in history, with hackers making off with approximately $1.4 billion worth of Ethereum and other cryptocurrencies, the company’s CEO confirmed yesterday.
The unprecedented security breach, which sent shockwaves through the digital asset markets, prompted an immediate sell-off as the purloined funds began moving to new addresses. Data analytics firm Arkham Intelligence reported that within mere hours of the announcement, approximately $200 million in staked Ethereum (stETH) had been liquidated by the perpetrators.
The theft triggered a cascade of market turbulence, with Ethereum’s price plummeting 5% from $2,800 to $2,660 in just 30 minutes following the 10:00 AM UTC announcement. Sister cryptocurrencies weren’t spared, as Chainlink and Aave suffered even steeper declines of 7% and 6% respectively.
Market activity exploded in the wake of the announcement, with Bybit’s trading volume surging by 150% to reach $3.2 billion within the first hour. The rapid sell-off of stolen stETH tokens caused their value to plunge by 10%, settling at $1,620 by 11:00 AM UTC.
The ripple effects spread quickly to Bitcoin, the market’s flagship cryptocurrency, which shed 3% of its value to trade at $43,650. Major exchanges Binance and Coinbase reported unprecedented spikes in trading volumes, with ETH-related trading pairs seeing increases of up to 200%.
The decentralised finance (DeFi) sector also felt the tremors, as major protocols including Aave and Compound witnessed a 5% decline in total value locked within two hours of the announcement.
Technical indicators painted a grim picture, with Ethereum’s Relative Strength Index plummeting from 65 to 40, signalling a dramatic shift from overbought to oversold territory. On-chain metrics revealed a 10% drop in active Ethereum addresses, though network transactions surged by 15% as traders scrambled to respond to the crisis.
While AI-focused cryptocurrencies showed relative resilience with only minor price corrections, the hack’s implications for algorithmic trading strategies remain to be seen. SingularityNET and Fetch.AI tokens experienced modest declines of 2% and 1.5% respectively, maintaining their historically low correlation with major cryptocurrencies.
This security breach stands as one of the most significant in cryptocurrency history, highlighting the persistent vulnerabilities in even the most established digital asset platforms. As investigations continue, the incident serves as a stark reminder of the risks inherent in cryptocurrency custody and trading.
The long-term impact on investor confidence and market stability remains to be seen, as the cryptocurrency community grapples with yet another high-profile security breach. Bybit has yet to detail their response plan or potential compensation for affected users.
