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Bybit loses $1.5B in hack

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Re: Bybit loses $1.5B in hack

#221

Post by phony-account »

killerstorm wrote: post #214
jqpabc123 wrote: post #211

Earlier quoted context omitted.

How on earth is it possible they can cover a 1.5B loss? Easy! They give Binance an IOU in exchange for 1.5 billion BUSD which is just "minted" out of fresh new electrons. Neither of them has really lost anything. Everyone can carry on as if it never happened. In the bizarro world of crypto, this is business as usual.

How it it different from what banks do? (Except for a central regulator.)

> How it it different from what banks do?

I often read this sort of comment from crypto-defenders, but is it what banks do?

I’m relatively naive about these things, but my impression is that a bank losing this proportion of their assets can’t just ‘pretend’ they have the money, or create ‘new’ money.

Re: Bybit loses $1.5B in hack

#222

Post by jqpabc123 »

killerstorm wrote: post #214
jqpabc123 wrote: post #211

Earlier quoted context omitted.

How on earth is it possible they can cover a 1.5B loss? Easy! They give Binance an IOU in exchange for 1.5 billion BUSD which is just "minted" out of fresh new electrons. Neither of them has really lost anything. Everyone can carry on as if it never happened. In the bizarro world of crypto, this is business as usual.

How it it different from what banks do? (Except for a central regulator.)

How it it different from what banks do? (Except for a central regulator.)

Your exception is the answer.

Only the central regulator can "mint" money and doing so has real world consequences. The central regulator has financial incentives to limit this sort of activity.

The bizarro world of crypto has no such regulation and as a result, it is inherently unstable.

The proof of this is right in front of you --- it is the fact that "stable coins" exist. The only way to bring stability to the bizarro world of crypto is by tying it to "fiat" --- which is the very thing crypto is supposedly working to eliminate.

Contradict and hypocrite much?

Re: Bybit loses $1.5B in hack

#223

Post by wruza »

ghfhghg wrote: post #159
anovikov wrote: post #136

Earlier quoted context omitted.

I have many friends who started from really humble beginnings ~5 years ago (or instance, a typical small business like "an e-shop selling bullshit Chinese gizmos online making 20k per month"), and are now uber rich in crypto. Like, hundreds of millions in net worth and spending 200-400k per month. And yes, they don't invest their money anywhere except new and new crypto projects themselves, just because they don't kn…

Just to be clear I'm not saying that my aquaintences didn't make money. Just that they are vague. But ultimately if you have friends making hundreds of millions of dollars and there is enough of them then that essentially proves there will be many more losers than winners. I personally don't partake for the same reason I didn't partake in Amway in college. It's functionally a pyramid scam and on a personal level a bo…

How do you know it’s boring? The guy above clearly has some bright ideas about it.

It’s on par with inventing an axe and now living in a forest god mode. Is that boring, or is that……… why I’m even asking, an ability to spend $e5/mo covers allmost all personal interests in the world.

Re: Bybit loses $1.5B in hack

#224

Post by Fade_Dance »

killerstorm wrote: post #214
jqpabc123 wrote: post #211

Earlier quoted context omitted.

How on earth is it possible they can cover a 1.5B loss? Easy! They give Binance an IOU in exchange for 1.5 billion BUSD which is just "minted" out of fresh new electrons. Neither of them has really lost anything. Everyone can carry on as if it never happened. In the bizarro world of crypto, this is business as usual.

How it it different from what banks do? (Except for a central regulator.)

Because while banks hold duration, the net value of their current assets, future asset streams, and equity is above zero. Indeed the core focus of the business and regulatory side is ensuring this is so.

The central regulator caveat is also a huge caveat to brush aside. During the last round of systemic stress, the banking system essentially got a guarantee that all uninsured deposits would be protected, and banks were allowed to post their collateral for liquidity at terms that no other business has access to.

What OP is referencing is the oft-seen practice in the crypto space where failed entities fill an asset hole with propped up tokens, essentially transforming their paper loss on the balance sheet into liquidity risk that doesn't show as readily.

The important point here is that in the latter case, the entity may be fully insolvent, even after accounting for future cashflows on loans. When it comes to banks, even the left tail cases like SVB, their "problem assets" are things like long term treasuries, which are way down the risk curve when compared to the ponzi-tokenonics style "stablecoins" that we've seen unwind over the past few years.

Re: Bybit loses $1.5B in hack

#225

Post by skeeter2020 »

killerstorm wrote: post #214
jqpabc123 wrote: post #211

Earlier quoted context omitted.

How on earth is it possible they can cover a 1.5B loss? Easy! They give Binance an IOU in exchange for 1.5 billion BUSD which is just "minted" out of fresh new electrons. Neither of them has really lost anything. Everyone can carry on as if it never happened. In the bizarro world of crypto, this is business as usual.

How it it different from what banks do? (Except for a central regulator.)

Banks don't print money for each other, and if they get money for free it's backstopped by the government and hence all of us. Crypto wants this single aspect but none of the central regulation.

Both systems stink for those at the end of the chain, i.e. us; you can decide which one is worse.

Re: Bybit loses $1.5B in hack

#226

Post by ghfhghg »

wruza wrote: post #223
ghfhghg wrote: post #159

Earlier quoted context omitted.

Just to be clear I'm not saying that my aquaintences didn't make money. Just that they are vague. But ultimately if you have friends making hundreds of millions of dollars and there is enough of them then that essentially proves there will be many more losers than winners. I personally don't partake for the same reason I didn't partake in Amway in college. It's functionally a pyramid scam and on a personal level a bo…

How do you know it’s boring? The guy above clearly has some bright ideas about it. It’s on par with inventing an axe and now living in a forest god mode. Is that boring, or is that……… why I’m even asking, an ability to spend $e5/mo covers allmost all personal interests in the world.

What? It's my personal opinion which I explicitly pre-qualified. Why do you care what I think?

Move on and live your life.

Re: Bybit loses $1.5B in hack

#228

Post by cherryteastain »

scrlk wrote: post #51
adastra22 wrote: post #40

Earlier quoted context omitted.

That’s well within the daily trading volume.

Exchanges will blacklist the addresses that hold the hacked ETH. They won't be able to deposit, or if they can deposit, the ETH will be frozen by the exchange.

Tornado cash and similar exist

Re: Bybit loses $1.5B in hack

#229

Post by wruza »

ghfhghg wrote: post #226
wruza wrote: post #223

Earlier quoted context omitted.

How do you know it’s boring? The guy above clearly has some bright ideas about it. It’s on par with inventing an axe and now living in a forest god mode. Is that boring, or is that……… why I’m even asking, an ability to spend $e5/mo covers allmost all personal interests in the world.

What? It's my personal opinion which I explicitly pre-qualified. Why do you care what I think? Move on and live your life.

Just curious, how think.

Re: Bybit loses $1.5B in hack

#230

Post by dboreham »

fresh_geezer wrote: post #184
rkagerer wrote: post #77

There's some info and speculation in these two (distinct) articles, but I'd love to know technical details of where the gaffs were. eg. Was client software compromised? Did the multisig keyholders succumb to social engineering? Were the signers using airgapped machines / hardware devices? https://archive.ph/YMZrq https://blockworks.co/news/bybit-hack-raises-security-questi...

Here is what the CEO wrote on X: "Bybit ETH multisig cold wallet just made a transfer to our warm wallet about 1 hr ago. It appears that this specific transaction was musked, all the signers saw the musked UI which showed the correct address and the URL was from @safe . However the signing message was to change the smart contract logic of our ETH cold wallet. This resulted Hacker took control of the specific ETH cold…

Oh, when I read this yesterday I assumed "musked" was a clever play on the idea that someone is tricked into agreeing to things against their interests.
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