Bybit Bounces Back: Exchange Liquidity Fully Recovers Post-Hack

Bybit’s order books are flush again—liquidity metrics now match pre-breach levels, signaling restored trader confidence (or short memories).

Behind the comeback: Aggressive market-making incentives and a ’nothing-to-see-here’ PR blitz drowned out last year’s security screams.

Closing thought: Exchanges always heal faster than users’ drained wallets—the crypto circle of life rolls on.

Liquidity Rebounds After $1.5 Billion Hack

On February 21, 2025, Bybit suffered a major security breach in which over 400,000 ETH, worth around $1.5 billion, was stolen. The attackers used a multi-signature exploit to trick cold wallet signers into approving a malicious transaction.

The United States Federal Bureau of Investigation (FBI) confirmed that the Lazarus Group, a North Korean-backed hacking organization, was behind the theft.

Following the incident, user confidence dropped sharply, according to the Kaiko report. The platform experienced more than 350,000 withdrawal requests. Trading slowed down, and market activity dipped across the board. The loss caused a noticeable decline in market depth, particularly for Bitcoin and altcoins on Bybit’s order books.

Despite these challenges, Kaiko’s report noted a recovery in Bitcoin liquidity. market depth, which refers to the ability to process large trades without major price changes, dropped to 0.1% shortly after the hack. However, it has improved significantly, climbing back to around 8% in March. This helped return Bybit’s Bitcoin trading environment to its pre-breach state.

The digital exchange giant reclaimed 7% of its market share following the $1.4 billion hack linked to the Lazarus Group. The exchange also regained investor confidence by introducing new security measures and strengthening liquidity through its partnership with Zodia Custody.

It is worth noting that this recovery took place even amid wider market pressure. A shift in United States trade policy in March and April triggered a global trade conflict, placing extra strain on the crypto markets.

Yet, Bybit’s market depth bounced back in 30 days of the attack, showing resilience not matched by all its competitors.

Institutional Orders and Altcoin Recovery Play a Role

It is worth mentioning that Kaiko’s report also pointed to the role of Retail Price Improvement (RPI) orders in restoring stability. These orders, introduced on February 20, one day before the hack, allow institutional traders to provide better pricing for retail customers. The timing of this launch may have helped ease volatility during the turbulent period and contributed to the liquidity comeback.

While Bitcoin saw the strongest rebound, the report noted that altcoin liquidity is also recovering, though more slowly. The top 30 market capitalization altcoins have regained over 80% of their previous market depth on Bybit. Kaiko linked the slower pace to caution in the market caused by wider economic concerns.

In comparison, other exchanges, such as HTX, Bithumb, and MEXC, recorded double-digit liquidity declines in March. Bybit’s 30% increase in market depth placed it ahead of its peers despite the earlier setback. This rebound highlights how the platform managed to regain stability and trader trust in a short time.

Meanwhile, Bybit’s CEO Ben Zhou revealed that 68.5% of the stolen funds, amounting to roughly $960 million, are still traceable. He added that over 84% of the hacked funds, approximately $1.2 billion in ETH, have been swapped to BTC.

Bybit Exchange Liquidity Returns To Pre-Hack Level: Report