- Hackers drained $1.4 billion stETH from Bybit using a disguised smart contract exploit.
- The attack altered wallet logic, enabling unauthorized withdrawals from a warm wallet.
- Security experts urge blacklisting compromised addresses and strengthening exchange defenses.
A massive security breach has sent shockwaves through the crypto world. Hackers drained over $1.4 billion worth of liquid-staked Ether (stETH) and MegaETH (mETH) from Bybit Exchange. Onchain analyst ZackXBT uncovered the attack and urged the community to blacklist addresses linked to the stolen funds. Bybit’s co-founder and CEO, Ben Zhou, later confirmed the breach. A fraudulent transaction disguised as a routine transfer tricked the system, allowing attackers to rewrite smart contract rules and siphon funds.
Hackers Exploit Smart Contract Vulnerability
The attack began with a transfer from Bybit’s multisignature wallet to a warm wallet. On the surface, everything appeared normal. However, hidden inside the transaction, malicious code quietly altered smart contract functions, handing control to the attackers. Ben Zhou explained how the hackers manipulated the system to execute the heist. By embedding harmful code within a seemingly legitimate transfer, the attackers changed the wallet’s logic, making unauthorized withdrawals possible. This level of sophistication suggests experienced cybercriminals orchestrated the entire operation.
Crypto Heists Are Becoming More Advanced
Security analysts, including ZackXBT, have warned the community to take immediate action. Blacklisting the compromised addresses could help limit further damage. Meanwhile, exchanges and investors face growing pressure to strengthen security, as cybercriminals continue to refine their methods.
The Bybit hack is the latest in a string of high-profile crypto hacks. Throughout 2024 and early 2025, hackers have targeted exchanges and decentralized finance platforms with increasingly sophisticated techniques. Each breach chips away at trust in digital asset security, forcing companies to rethink defense strategies.
Bybit’s ordeal underscores an urgent reality—no platform is untouchable. Exchanges must prioritize stronger security measures to stay ahead of cyber threats. Smart contract audits, improved transaction monitoring, and stricter internal controls could help prevent similar disasters. Until security catches up, the crypto industry remains locked in a battle against digital thieves who always seem one step ahead.
