Bybit and Safe Custody Disagree Over Responsibility in $1.5B Cryptocurrency Breach

Cryptocurrency trading platform Bybit has released a forensic analysis of the recent $1.5 billion hack, determining that its own systems remained secure and the problem originated from the compromised infrastructure of Safe wallets.

According to Bybit's investigation, "the credentials of a Safe developer were compromised," enabling the Lazarus hacking group to gain unauthorized access to the Safe wallet and deceive Bybit employees into signing the harmful transaction.

However, an individual with knowledge of the situation informed CoinDesk that even though the wallet's infrastructure was breached via social engineering, the hack would not have succeeded if Bybit had not "blind signed" the transaction. This term refers to a process where a smart contract transaction is authorized without complete understanding of its contents.

Safe also released a statement asserting that "Safe smart contracts [were] unaffected, an attack was conducted by compromising a Safe {Wallet} developer machine which affected an account operated by Bybit." It emphasized that "a forensic review of external security researchers did NOT indicate any vulnerabilities in the Safe smart contracts or source code of the frontend and services."

The apparent disagreement between the two companies reflects the blame game between WazirX and Liminal Custody, who pointed fingers at each other following a $230 million exploit last July.

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ZachXBT's analysis of on-chain data shows that Lazarus is attempting to launder the stolen funds, with 920 wallets currently being tainted with the ill-gotten gains. The funds, possibly inadvertently, have been mixed with stolen funds from hacks targeting Phemex and Poloniex, connecting Lazarus Group to all three incidents.

Additional information: Bybit Announces ‘War on Lazarus’ as It Crowdsources Effort to Freeze Stolen Funds

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