Bybit's massive security breach, which cost $1.5 billion, is sparking debates about cryptocurrency security at ETHDenver 2025. Industry experts are calling for a comprehensive overhaul, emphasizing the need for decentralized solutions to mitigate future security risks.

What Caused the Bybit Hack
The attack, which occurred in early February 2025, was determined to be related to a vulnerability in the Safe wallet infrastructure, not Bybit's internal systems. Although a forensic assessment confirmed that internal security was not compromised, the event still raises concerns about the vulnerabilities of centralized storage services.

Kai Wawrzinek, co-founder of Impossible Cloud Network, said the hack highlighted the risks of relying on centralized cloud platforms like Amazon Web Services (AWS). He stressed that while AWS was not the primary cause, the compromised credentials there may have contributed to the incident.

Expert Opinions on Cryptocurrency Security
1. Poor Key Management Policies
Oliver Gale, CEO of Panther Protocol, said that the main problem was not centralized exchanges but poor key management policies. He criticized Bybit for not using air-gapped devices when depositing $1.4 billion in ETH, calling it a serious oversight. Gale also called on exchanges to spend a portion of their revenue on improving security as a way to “buy insurance” for themselves.

2. Decentralized Storage is a Necessary Solution
Phil Mataras, founder of AR.IO, emphasized the role of decentralized data storage in protecting transactions from tampering. He argued that blockchains like Arweave can provide a permanent backup system, helping to track and restore data before attacks occur.

3. Systemic Vulnerabilities in Centralized Exchanges
Louis Bellet, chief architect of decentralized payments network Yellow, said the Bybit hack is a warning sign of systemic risks in centralized exchanges. According to him, these platforms still have single points of failure, and if compromised, the consequences can be dire.

The Future of Cryptocurrency Security
The Bybit hack has raised questions about how the cryptocurrency industry will move forward. Experts agree that adopting decentralized technology, improving key management processes, and reducing single points of failure will help strengthen security.

The question is whether this incident will lead to real reforms in the industry, or whether it will continue the cycle of passive response to each attack. How Bybit and other exchanges handle this situation will greatly affect the confidence of the cryptocurrency market in the future.

FAQ
- How big was the Bybit hack?
At $1.5 billion in losses, it is one of the largest hacks in crypto history, surpassing Ronin Bridge ($620 million) and coming close to Poly Network.

- What lessons can we learn from this attack?
This incident shows that even the most stringent security systems can be vulnerable to human error and key management flaws.

- What regulatory changes are likely?
Experts predict stricter regulations on asset storage, including cold storage requirements, independent security audits, and asset reserve certification.

The cryptocurrency industry is facing a critical period where a shift in security thinking could determine the future of the entire ecosystem.