Bybit Closes Ethereum Gap Through Loans and OTC Buys Days After Hack

Cryptocurrency exchange Bybit has acted quickly to bridge a $1.4 billion gap in Ethereum (ETH) following a suspected hack linked to North Korean hackers.

Utilizing loans, whale deposits, and over-the-counter (OTC) purchases, Bybit managed to recover the lost funds in a remarkably short period of just two days.

According to blockchain data from Lookonchain, Bybit has secured around 446,870 ETH, equivalent to roughly $1.23 billion, from various sources. Notably, one address transferred a substantial 157,660 ETH, valued at about $437.8 million, indicating it was likely a significant OTC transaction. Another contributor provided 109,033 ETH, worth $304.1 million, acquired from a mix of centralized and decentralized exchanges.

Institutional Support and Crypto Loans

In addition to OTC dealings, several cryptocurrency institutions offered considerable ETH loans to further mitigate the gap. Bitget, another exchange, lent Bybit 40,000 ETH, approximately $106 million, while MEXC contributed 12,653 stETH, valued at around $33.9 million.

Mirana Ventures and a group possibly connected to Fenbushi Capital each sent 10,000 ETH, totaling about $28 million. Additionally, individual contributors such as DWF Labs and a user identified as “@yuchao” helped by lending 2,200 ETH and 2,499 ETH, respectively.

Assurance to Users and Future Transparency

Bybit’s CEO, Ben Zhou, announced the successful recovery on social media, assuring clients that the exchange has “fully closed the ETH gap.” He also promised that an audited proof-of-reserves (PoR) report would be forthcoming, confirming that client assets are now fully backed at a 1:1 ratio through a Merkle tree system. This mechanism allows users to verify their holdings independently while safeguarding their privacy.

Investigating the Bybit Hack

Complicating matters, blockchain investigator ZachXBT revealed ties between this incident and a recent breach at Phemex, with both hacks allegedly using the same funds. To enhance security and track down the hackers, Bybit has introduced a $140 million bounty for anyone providing leads on recovering the stolen assets.

With the ETH gap now closed and a new PoR audit anticipated, Bybit aims to rebuild user trust while strengthening its security framework, demonstrating how effectively exchanges can respond to threats through collaboration and transparency.