Bybit Hack: Ethereum Network Activity Spikes 10% as Market Volatility Grips the Crypto Industry

Bybit has suffered one of the most significant security breaches in the history of digital assets. Hackers stole approximately $1.46 billion in Ethereum (ETH) from Bybit's hot wallets, sending shockwaves through the crypto industry.

Cryptocurrency exchange Bybit suffered a major security breach on February 21, 2025, with hackers stealing approximately $1.46 billion in Ethereum (ETH) from the exchange’s hot wallets.

The incident sparked debates within the crypto community over blockchain security and governance, particularly regarding the possibility of recovering the stolen funds through a hard fork of the Ethereum blockchain.

According to a post by Mihir, there have been discussions on whether Ethereum should fork to retrieve the stolen $1.46 billion. Mihir argues that if a fact is legally proven, the Ethereum blockchain can fork on a court order to regain control of the stolen funds.

The stolen ETH was quickly moved into several wallets, with the largest transaction being 30,000 ETH. Regarding the $1.46 billion hack, the Ethereum blockchain should fork on a court order and get back the fund. When a fact is legally proven, why can’t a blockchain be forked and take back control?

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The Bybit hack had an immediate impact on Ethereum's price, with ETH dropping from $3,500 to $3,200 within an hour of the hack announcement. Trading volumes on major exchanges like Binance and Coinbase soared to 2.5 million ETH during this period.

The ETH/BTC trading pair declined by 3%, and the ETH/USDT pair also showed a downward trend. Market participants shifted funds into Bitcoin in response to the news, causing BTC's price to rise by 1.5% to $50,000.

On-chain data revealed a surge in Ethereum network activity, with active addresses increasing by 10% to 750,000 over the following 24 hours. This spike indicated heightened market interest and potential attempts to manipulate trading.

Technical indicators showed Ethereum's Relative Strength Index (RSI) decreasing from 70 to 55, suggesting a transition from an overbought to a neutral zone. The Moving Average Convergence Divergence (MACD) signaled a bearish crossover, and trading volumes stabilized at around 1.8 million ETH daily by February 21, 2025.

Bybit confirmed the breach on its official Twitter account, stating that the incident had been reported to the authorities and that cold wallets were still secure.

The exchange halted withdrawals during this time but assured users that their funds were safe and that they would be notified once withdrawals resumed.

Blockchain analytics firms Elliptic and Arkham Intelligence linked the hack to the Lazarus Group, which has been involved in several large-scale crypto heists.

This breach surpasses the Ronin Network attack ($624 million) and the Poly Network exploit ($611 million) to become the largest crypto theft on record.

The theft triggered a ripple effect across the crypto market, with Bitcoin dropping 3.5% to $47,200, Ethereum falling 2.8% to $3,150, and Bybit's native token BIT decreasing by 10% to $0.90.

Trading volumes surged on Bybit, with the BTC/BIT transactions reaching 50,000 BTC. Other major cryptocurrencies, such as Solana and Cardano, also experienced volatility in the wake of the news.