ByBit, one of the world’s leading crypto trading platforms, is fighting back after falling victim to what’s believed to be the largest cryptocurrency theft in history. Hackers linked to North Korea’s infamous Lazarus Group stole $1.46 billion (£1.1bn) in crypto last week, triggering a global manhunt for the stolen assets.
Crowdsourcing Crypto Bounty Hunters
To recover its losses, ByBit has launched an innovative online bounty program, offering cash rewards to individuals and companies that help track and freeze the stolen funds.
ByBit’s CEO, Ben Zhou, took to social media, urging the crypto community to take action: “Join us in the war against Lazarus.” His post linked to a newly launched website that features a live leaderboard, showcasing successful crypto detectives who have identified and frozen stolen funds.
How the Bounty Works
Since cryptocurrency transactions are recorded on public blockchains, the stolen assets can be traced as they are laundered through various platforms. ByBit is offering:
- 5% of the identified amount to individuals who convince crypto platforms to freeze stolen assets.
- An additional 5% to the companies that take action to prevent further movement of the funds.
Already, millions of dollars in rewards have been distributed to successful crypto sleuths.
Crypto Community Takes Action
Crypto analytics firm Elliptic has praised ByBit’s approach as a “positive innovation.” Tom Robinson, an expert at Elliptic, stated, “There are many talented blockchain investigators who will now be motivated to track these stolen funds and help seize them.”
However, Louise Abbott, a crypto fraud expert at Keystone Law, warned that this attack could damage trust in the industry. “If such a hack can occur on this scale at the world’s second-largest exchange, it can certainly happen again,” she said.
Resistance from Crypto Platforms
Unlike traditional financial institutions, crypto transactions lack oversight from central banks or regulators. As a result, ByBit must rely on the cooperation of other exchanges to freeze funds.
Not all platforms are willing to help. One exchange, eXch, has refused to cooperate, despite evidence that $75 million of the stolen funds have already passed through its system. According to Elliptic, eXch allows anonymous crypto swaps and has facilitated hundreds of millions in illicit transactions, including multiple North Korean crypto thefts.
North Korea’s Role in Crypto Crime
ByBit’s website features a logo depicting North Korean leader Kim Jong Un’s iconic hairstyle with a knife through it—a bold statement against the Lazarus Group.
Over the past few years, Lazarus has stolen an estimated $6 billion in cryptocurrency, with experts claiming the funds are used to evade international sanctions and develop North Korea’s military capabilities.
While North Korea has never admitted involvement, global security analysts continue to link the regime to large-scale cyber thefts.
A New Era of Crypto Security?
ByBit has announced plans to open its bounty platform to other victims of crypto theft, potentially transforming the industry’s approach to security and fraud prevention.
As ByBit and the crypto community wage war against the Lazarus Group, the success of this bounty program could set a precedent for how future cyber heists are handled.
