Crypto exchange Bybit suffers $1.4 billion hack. Here’s why it’s troubling for the industry.

Bybit, one of the world’s largest cryptocurrency exchanges, experienced a hack Friday in which over $1.4 billion worth of crypto was stolen, according to blockchain-analytics firms. It’s the latest incident for an industry struggling with security concerns that present hurdles to mainstream adoption.

The Dubai-headquartered crypto exchange saw an ether cold wallet hacked on Friday, Ben Zhou, co-founder and chief executive of Bybit, wrote in a post on X. The attacker transferred all of the ether in the wallet to an unidentified address, Zhou said.

All customer withdrawals from Bybit are normal, Zhou said. “Bybit is Solvent even if this hack loss is not recovered, all of clients assets are 1 to 1 backed, we can cover the loss,” he wrote in a post. Bybit is not available to U.S. investors.

Representatives at Bybit did not respond to a request from MarketWatch seeking comment.

The hacker stole 401,347 ether, 90,376 stETH, 15,000 cmETH and 8,000 mETH that are worth a total of over $1.4 billion, according to Nansen, a blockchain-analytics firm, with stETH, cmETH and mETH representing ether tokens that are staked, or locked up to secure the Ethereum blockchain.

The funds were first transferred to a primary wallet and then distributed across 40 wallets, Nansen said.

The hack is the latest incident in which the crypto industry has been targeted.

In 2024, crypto platforms saw $2.2 billion in funds stolen, an increase of 21.1% year over year, according to data from blockchain-analysis firm Chainalysis.

In five of the last 10 years, crypto platforms saw over $1 billion worth of digital assets stolen each year, according to Chainalysis.

Bitcoin BTCUSD fell 1.4% on Friday to around $96,986, roughly 11.2% away from its all-time high of $109,225, reached on Jan. 20. Ether declined 1.9% to $2,675 on Friday.