BlockByte Weekly: Largest Hack In Financial History

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Thanks for reading The BlockByte Weekly, where we summarise the key updates in crypto over the last week and provide our perspective on what you need to know as an investor.
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Executive Summary​
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• ByBit Experiences Largest Financial Hack In History (~US $1.5B)
• SEC To End Lawsuit Against Coinbase, Propelling Industry & US Crypto Companies Forward
• First Publicly Listed South African Company To Adopt Bitcoin As Treasury Asset
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Market Update​
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ByBit Experiences Largest Financial Hack In History (~US $

On Feb 21st, ~US $1.5B (449.395 ETH) was stolen by North Korean hackers Lazarus Group from ByBit exchange. This was the largest hack known to date. ByBit which holds ~$20B in assets was breached as hackers manipulated what was seen on the screen of the cold storage signing devices. According to Binance CEO, Changpeng Zao, the hackers were "able to make the front-end user interface show a legitimate transaction while the actual signing was for a different transaction". Since the breach, over $5.5B of withdrawals have been made from ByBit, all of which have been processed successfully, with the founder Ben Zhou saying that the company has sufficient funds to cover the losses.

Whilst there has been a call across the crypto community to fork the Ethereum chain, or manually rollback the transactions, it is unclear that this will be possible as the funds have already started to be transferred into other blockchains.

For BlockByte customers, rest assured that we use Fireblocks custody, the gold standard in crypto security with EY audited procedures, mutliple account servers and MPC technology which splits keys across mutlipe devices to minimise chances of a breach. Fireblocks wrote extensively on the risks that some exchanges face, including instances of device breaches and how to prevent them here.

SEC To End Lawsuit Against Coinbase, Propelling Industry & US Crypto Companies Forward

The SEC has said it plans to withdraw its litigation against Coinbase, and this is expected to be confirmed as early as next week. Brian Armstrong, CEO of Coinbase said that this action was righting a wrong, with the SEC having allowed Coinbase to IPO in 2021 and since then spent years "trying to kill this industry". According to Brian, the SEC had no legal grounds to litigate against Coinbase who spent $50M in defending the case. If the case is dropped, this marks an important milestone and shift in the US towards bringing more regulatory clarity and room for US companies to innovate and build products in Web3 domestically in the US.

@coinbase

SEC staff have agreed to dismiss their case against us (pending Commission approval).But this isn’t the end.It’s the beginning.And if there were ever a time to build—that time is now.Thank you to everyone who stood with us, and stood with crypto.

12:5 AM • Feb 22, 2025

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First Publicly Listed South African Company To Adopt Bitcoin As Treasury Asset

A South African company, Altvest Capital Ltd., is set to become Africa's first listed company to adopt Bitcoin as its primary treasury reserve asset, following a strategy similar to Michael Saylor's Strategy.com (formerly MicroStrategy). The company has already purchased one Bitcoin and has applied for regulatory permission to raise approximately 200 million rand ($10 million) through share sales to increase its Bitcoin holdings. CEO Warren Wheatley views Bitcoin as a strategic reserve asset that can hedge against economic instability and the depreciation of the South African Rand. This approach mirrors Saylor's successful strategy, which has led to a 2,400% surge in his company's value since 2020, though critics warn about the risks of Bitcoin's volatility on corporate balance sheets.

For A Confidential Discussion

Feel free to reach out to me anytime to discuss how we can support you on your digital asset journey.
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Until next week,
James

James Brannan
Chief Executive Officer
BlockByte Capital
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(+61) 412 393 634
​james@blockbyte.com.au​
​https://blockbyte.com.au/​

BlockByte does not provide financial advice. We provide execution support, research and insured custody for investing in digital assets. Reach out to our team to discuss how we can help.

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