Bybit Gets Hacked for $1.46B in ETH in Biggest Crypto Exchange Theft Ever, While GameStop Might Look at Bitcoin for Its Balance Sheet

About two weeks ago, Dubai-based Bybit became the victim of the largest crypto exchange hack ever after attackers stole $1.46 billion worth of ETH from its wallets. However, the silver lining of this incident is that the crypto industry came together to help mitigate the impact of the theft on the exchange itself and the wider crypto industry.  

Another interesting story I followed recently is that an engagement letter was sent to GameStop’s CEO Ryan Cohen that urged the company to convert its $5 billion cash reserves into Bitcoin, which could lead to another publicly traded company adding the hardest money in the world to its balance sheet. 

Bybit Gets Hacked for $1.5B in Largest Crypto Theft Ever! 🤯

If you’ve been in the digital assets ecosystem as long as I have, you’ve seen one or two big crypto exchange hacks. 

However, it’s been a while since we’ve seen a major exchange hack. 

Unfortunately, last week, we saw the biggest one ever. 

What happened? 

The centralized crypto exchange Bybit came out and explained that hackers–apparently the North Korean Lazarus Group–were able to crack its sophisticated wallet infrastructure and steal almost $1.5 billion worth of Ethereum tokens. 

In total there were over 400,000 ETH and over 100,000 stETH and mETH tokens stolen. The exact number is not publicly known as the investigation is ongoing. 

Regardless of the exact number, this news is worrisome, and Bybit had to react quickly. Otherwise, users could withdraw their funds, leading to a “bank run” on the exchange. 

This is where the Bybit team and the larger ecosystem players stepped up. 

Within 24 hours, they were able to replenish their reserves through a mix of emergency loans and large deposits. ByBit secured nearly 447,000 ETH through emergency funding from Galaxy Digital, FalconX, and Wintermute.

They also went a step further and conducted a new proof of reserves audit by cybersecurity firm Hacken, which confirmed that the exchange had successfully restored its reserves. 

Although experiencing yet another exchange hack obviously isn’t great for the industry, the crypto community’s quick actions to mitigate the potential fallout show that the industry is stronger than ever. 

While it’s good to see the crypto industry’s maturity at this stage, this exchange hack acts as an important reminder to self-custody your coins–and not to hold them on an exchange.  

A Letter Sent to GameStop’s CEO Urges Him to Convert $5B in Cash to Bitcoin 🚀

People are talking about GameStop again! 

And no, it’s not for Part 2 of the GameStop Saga. 

This time, it’s because of Bitcoin. 

GameStop CEO Ryan Cohen received an engagement letter from Matt Cole, CEO of Strive Asset Management, urging the gaming company to put a large proportion of its $5B in cash reserves into Bitcoin.

“We believe GameStop has an incredible opportunity to transform its financial future by becoming the premier Bitcoin treasury company in the gaming sector. With nearly $5 billion in cash on its balance sheet, the firm is uniquely positioned to shift its reserves from a shrinking asset to a growth engine, propelling GameStop from meme stock to market leader, one Bitcoin at a time,” Cole wrote in the letter. 

While GameStop hasn’t officially commented on the matter, Cohen met with Michael Saylor a few weeks ago, as shown in the image below. Who knows, maybe they’re already thinking about it? 

The GameStop stock rallied 8% that day by posting this picture alone. 

Also, Cohen only follows three accounts on X: @Bitcoin, @BitcoinMagazine, and @GameStop. 

While I can’t see the future, considering how well the Bitcoin treasury strategy worked for Strategy (and is working for us at Samara Asset Group), I think it could also be the right move for GameStop. 

Your fellow stacker in sats, 

Patrick Lowry