Bybit’s $1.5B hack: when people, not tech, are the weakest link
- Written by Janine Grainger: Founder and CEO, Easy Crypto
On the 21st of February, hackers pulled off what’s being called the biggest digital heist in history and managed to siphon $1.5 billion from the global crypto exchange Bybit. The sheer scale of the attack reignited the usual debate: Is crypto even safe and critics jumped at the chance to call out the industry’s security flaws.
But here’s the thing - the wallets worked exactly as they should. This wasn’t a failure of blockchain tech; it was a failure of human security.
Janine Grainger, Founder and CEO of Easy Crypto, breaks down what happened, whether the funds can be recovered and what the industry needs to consider next.
How did it happen?
The Bybit hack wasn’t a high-tech breach where attackers cracked cryptographic security. They didn’t need to. Instead, they did something far simpler - they outmaneuvered people.
It started with a routine transfer. Bybit was moving Ethereum from a cold wallet (highly secure, offline storage) to a warm wallet (semi-online, used for daily trading). Somewhere in that process, attackers infiltrated a developer’s machine and gained access to Bybit’s wallet management system.
From there, they manipulated the user interface, injecting malicious code that altered the transaction approval process. When employees signed off on what looked like a normal transfer, they were unknowingly rerouting funds straight into hacker-controlled accounts.
A key part of the deception involved blind signing - employees signed transactions without fully seeing what they were approving. The hackers exploited this flaw so well that even experienced staff didn’t realise what was happening.
Blockchain didn’t fail. Human oversight did.
Can the money be recovered?
The heist has been linked to Lazarus Group, a North Korean state-sponsored hacking collective infamous for looting crypto exchanges to fund sanctioned activities.
While the attack was swift, cashing out won’t be easy. Blockchain transactions are public, meaning the stolen funds are now under intense scrutiny. Laundering that much crypto without leaving a trace is nearly impossible - unless they convert it into privacy coins like Monero, which are far harder to track.
Bybit has wasted no time responding. They secured emergency funding to restore liquidity and launched a bounty program, offering a 5% reward to anyone who helps track and freeze the stolen funds. They’ve even set up a real-time leaderboard, turning crypto sleuths into bounty hunters.
Lessons for the industry
This wasn’t a failure of blockchain - it was a failure of security culture. And if the industry doesn’t learn from it, history may repeat itself.
* Blind signing needs to go. Users must be able to clearly see and verify what they’re approving. Exchanges need to phase out outdated approval processes and move toward multi-party computation (MPC) wallets, which eliminate the risk of a single key compromise. (Easy Crypto already uses MPC wallets for this reason.)
* Cybersecurity training can’t be optional. Regular security drills and phishing awareness sessions should be standard. Attackers are only getting more sophisticated.
* AI-powered fraud detection must be the norm. Real-time monitoring tools can detect suspicious transaction patterns instantly, stopping hacks before they escalate.
The investor cheat sheet
Security is only as strong as the people behind it. If you want to protect assets in a world of increasingly sophisticated cyberattacks, keep these truths in mind:
* Assume attackers will exploit human mistakes before tech flaws. Most breaches aren’t about breaking encryption - they’re about tricking people.
* Assume every transaction needs scrutiny. Fast approvals save time, but they also create vulnerabilities.
*Assume hackers will try again. The Lazarus Group didn’t stop after their last billion-dollar heist, and they won’t stop now.
What happens next?
This attack didn’t expose a weakness in blockchain - it exposed a weakness in human oversight. But that distinction won’t matter much to the average person. The damage is already done, and trust in crypto security has taken another hit.
The question now isn’t if there will be another attack. It’s when. The real challenge is whether the industry will step up before it happens again.
