Crypto Market Loses $325B Following Major Bybit Hack

The cryptocurrency market experienced a significant downturn, losing $325 billion in value since February 21, 2025, due to a major hack on the Bybit exchange allegedly carried out by the Lazarus Group.

The market downturn underscores growing cybersecurity risks and questions Bybit’s future stability, leading to widespread crypto sell-offs and eroding investor confidence.

Impact and Response

Bybit’s Ethereum wallets were targeted in a hack, resulting in $1.4-1.5 billion in losses. Reports indicate the Lazarus Group as the perpetrator. Bybit CEO Ben Zhou has assured users that the exchange will cover the losses to mitigate impact. Zhou noted:

“We will cover all user losses to mitigate impact.”

The hack notably affected major cryptocurrencies, with Bitcoin dropping below $90,000 and Ethereum hit the hardest due to the attack’s origin. Bybit’s assurance aims to prevent replicate incidents similar to the FTX collapse.

Immediate consequences included a broad sell-off in crypto-related stocks, affecting companies like Coinbase and MARA Holdings. Alongside significant financial implications, confidence in trading platforms was shaken. Socially, users on various forums expressed concern and called for stricter security measures across exchanges, fearing more attacks. This incident aligns with historical trends monitoring the impact of major exchange compromises.

Future Projections

Future outcomes may involve increased scrutiny on exchange security protocols, potential tighter regulations, and technological advancements to prevent future breaches. Past incidents reflect a persistent risk pattern in the crypto sector as cyber threats evolve.

Sam Bankman-Fried (SBF), former CEO, FTX, posted on X: “I have a lot of sympathy for gov’t employees: I, too, have not checked my email for the past few (hundred) days,” followed by “And I can confirm that being unemployed is a lot less relaxing than it looks.”