Bitget stepped in to help Bybit, another crypto exchange, after Bybit was hacked and faced a liquidity crunch. The hack, carried out by North Korea’s Lazarus Group, stole $1.4 billion in ETH, causing users to withdraw $5.5 billion in assets. Bitget’s $106 million ETH transfer, along with $132.5 million from Binance, stabilized Bybit within 24 hours.
This move prevented Bybit from collapsing and showed how crypto exchanges can support each other during crises. It’s a big deal because such cooperation is rare in a competitive industry, boosting trust in the sector.
Bybit launched a $140 million bounty to recover stolen funds, and the crypto community is watching if this sets a precedent for future collaborations.
A Comprehensive Analysis of Bitget’s Support to Bybit Amid Liquidity Concerns
In a remarkable display of industry solidarity, Bitget, a leading cryptocurrency exchange, extended a significant liquidity support of 40,000 ETH (approximately $106 million) to Bybit, another major exchange, on February 23, 2025, following a devastating hack that threatened Bybit’s stability. This event, reported across multiple crypto news outlets, underscores the growing sense of community within the cryptocurrency sector, particularly in times of crisis. This analysis delves into the details of the hack, Bitget’s intervention, and its implications, ensuring a thorough understanding for both novices and seasoned market watchers.
Background on Bitget and Bybit
Bitget and Bybit are prominent players in the cryptocurrency exchange market, known for their robust trading platforms and significant user bases. Bitget specializes in derivatives and futures trading, while Bybit is renowned for its spot and margin trading offerings, with a daily trading volume of around $22 billion. Both exchanges operate in a highly competitive landscape, where liquidity—defined as the ability to meet withdrawal requests promptly—is crucial for maintaining user trust and operational stability.
Recent events, however, have tested Bybit’s resilience. The cryptocurrency industry has seen several high-profile exchange failures, such as FTX in 2022, which eroded user confidence. Against this backdrop, Bybit’s liquidity concerns emerged as a critical issue, particularly following a massive cyberattack.
The Event: Hack and Liquidity Crisis
On February 21, 2025, Bybit fell victim to a cyberattack orchestrated by the Lazarus Group, a North Korean state-sponsored hacking collective known for targeting crypto entities. The attack compromised Bybit’s multisig cold wallet, resulting in the theft of 401,346 ETH, valued at approximately $1.4 billion at the time, making it one of the largest cryptocurrency heists in history (BlockchainReporter: Bitget Extends Lifeline to Bybit Amid Liquidity Concerns). This loss triggered panic among users, who initiated mass withdrawals, pulling out over $5.5 billion in assets within 24 hours, as tracked by DefiLlama (Bitcoinist: Bitget Extends Help to Bybit Following Hack).
This withdrawal frenzy pushed Bybit into a liquidity crisis, where it struggled to meet the demand for withdrawals, threatening its operational continuity. Bybit’s CEO, Ben Zhou, assured users that reserves exceeded liabilities, but the scale of the crisis necessitated external intervention to restore confidence and stability.
Bitget’s Intervention: A Liquidity Support Lifeline
Stepping into the breach, Bitget announced on February 23, 2025, that it had transferred 40,000 ETH (approximately $106 million, based on an ETH price of $2,650 at the time) to Bybit’s cold wallets, providing much-needed liquidity support. This move was complemented by a transfer of 50,000 ETH (approximately $132.5 million) from Binance, bringing the total support to around $238.5 million (CryptoBriefing: Binance and Bitget transfer over 50K ETH to Bybit). Bitget’s CEO, Gracy Chen, confirmed via an X post that the transfer was made without any collateral, interest, or fixed repayment timeline, allowing Bybit to return the funds when its situation stabilized (Bitget CEO Statement on X).
This act of altruism was crucial in stabilizing Bybit’s operations. By February 22, Zhou announced that Bybit had processed 99.9% of 350,000 withdrawal requests within 10 hours, restoring normal operations (Bybit Expresses Deep Gratitude as Crypto Industry Unites Against Security Threats). Bitget’s intervention, alongside Binance’s, prevented a potential collapse, averting what could have been a broader market contagion given Bybit’s significant market presence.
Why This Cooperation is Significant
The collaboration between Bitget and Bybit is particularly noteworthy given the competitive nature of the cryptocurrency exchange industry. Typically, exchanges vie for market share, user base, and trading volume, making such support rare. Bitget’s decision to extend liquidity support without financial gain highlights a growing sense of community and mutual support, especially in the face of external threats like the Lazarus Group hack. This event is seen as a testament to the industry’s maturation, moving toward greater cooperation to protect user interests and sector stability.
The timing is also significant, occurring under a crypto-friendly U.S. administration led by President Donald Trump, with increased focus on combating North Korean cyberattacks, as noted in a January 2025 joint statement by the U.S., South Korea, and Japan (U.S. Department of State joint statement). This geopolitical context may have encouraged exchanges to band together against common threats, reinforcing the importance of liquidity support in crisis management.
Implications for Investors and the Industry
For investors, this event has several implications:
- Enhanced Trust: Bitget’s liquidity support to Bybit could restore confidence among users, particularly those affected by the hack. It signals that exchanges can rally to support each other, potentially reducing panic in future crises.
- Market Stability: By preventing Bybit’s collapse, this cooperation helped maintain market stability, avoiding a domino effect that could have impacted other exchanges and token prices. This is crucial in an industry prone to volatility.
- Precedent for Collaboration: This instance may set a precedent for future collaborations among crypto exchanges, fostering a more resilient ecosystem. Investors might see this as a positive sign for the sector’s long-term growth.
To illustrate the scale of the support, consider the following table comparing the contributions:
| Exchange | ETH Transferred | Value (Million USD) | Conditions |
|---|---|---|---|
| Bitget | 40,000 | 106 | No collateral, no interest |
| Bybit | 50,000 | 132.5 | Not specified in detail |
| Total | 90,000 | 238.5 | Combined effort |
This table underscores the significant financial commitment and the cooperative spirit behind the liquidity support.