The FBI accused North Korea on Wednesday of being behind the theft of $1.5 billion in digital assets from the cryptocurrency platform Bybit, marking the largest hack in the industry’s history.
In a statement, the FBI said the attack was carried out by the North Korean cyber group TraderTraitor, also known as Lazarus Group, which has already begun converting part of the stolen funds into Bitcoin and other cryptocurrencies spread across thousands of addresses on multiple blockchains.
“These assets are expected to be further laundered and eventually converted into fiat currency,” the agency warned.
The Lazarus Group gained notoriety a decade ago when it was accused of hacking Sony Pictures in retaliation for the film The Interview, which mocked North Korean leader Kim Jong Un.
According to a U.S. military report from 2020, North Korea operates a cyber warfare unit of 6,000 agents, known as Bureau 121, which is active in multiple countries.
A few days ago, Bybit, a Dubai-based cryptocurrency exchange, confirmed that one of its cold wallets (offline storage) for Ethereum (ETH) was compromised, resulting in the loss of approximately $1.46 billion in assets.
According to its CEO, Ben Zhou, the attacker manipulated the code of a transaction between two Bybit wallets, forging the signing interface and gaining control of the compromised wallet.
This hack surpasses the $611 million theft from Poly Network in 2021, making it the largest attack of its kind to date, according to analytics firm Elliptic.
Despite the scale of the breach, Bybit assured that “all customer funds remain safe, and our operations continue without interruption.” Zhou also guaranteed that the company would fully cover the loss.
Analysts at Arkham Intelligence confirmed that around $1.4 billion has begun moving to new addresses and that $200 million has already been sold in an Ethereum derivative.
After news of the attack broke, the price of Ether (ETH) dropped by 5%, but it later recovered by the end of the day. Other cryptocurrencies saw little fluctuation.
Additionally, Ethena Labs’ USDe, a token acting as a “synthetic dollar”, briefly lost its peg to the dollar, trading at $0.98, though the project assured that it remains fully collateralized.
It is important to note that Bybit is one of the world’s largest cryptocurrency exchanges, with a daily trading volume exceeding $36 billion and total assets of $16.2 billion before the hack, according to CoinMarketCap. The theft accounts for 9% of its total assets, making it an unprecedented blow to the industry.
As the FBI and blockchain experts investigate the attack, U.S. authorities warned that North Korea continues to use cybercrime to fund its regime, including its nuclear and missile programs.
