$1.5B Bybit Hack VS Lazarus

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Good Morning.

It has been a crazy week with the Bybit hack and the ongoing Infinex and OX Fun situations. Please stay safe out there. In the meantime, the market has been relatively, slow to recover, but recent TGEs such as IP and BERA are having a decent recovery.

In Today's Email:

• What Matters: Bybit $1.5B Heist Saga 🔎 

• Product: Kanye West’s Memecoin? 🤔 

• Charts: BTC ETFs Volume Hit $750B, $KAITO Hits $1.7B FDV 📈 

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WHAT MATTERS

Lazarus Group’s Bybit $1.5B Heist Saga

State of play: North Korea’s state-sponsored Lazarus Group has been definitively linked to the Bybit hack that has resulted in over $1.5B in crypto losses.

• Detailed forensic analysis and transaction tracking by ZachXBT and verified by Arkham, provided compelling evidence tying the notorious group to the breach.

• In response, Bybit confirmed the incident and announced a bounty program, offering 10% of any recovered funds (~$140M) to incentivize assistance.

• Recovery efforts are already underway, the mETH Protocol team successfully intercepted 15,000 cmETH tokens valued at around $43M.

• Tether reported that $181,000 in USDT has been frozen.

• These early recoveries are significant, considering that previous Lazarus hacks have proven notoriously difficult for fund recovery.

• This latest breach is deemed the largest single crypto theft in history.

What’s next: Enhanced monitoring systems, stricter internal controls, and coordinated efforts with cybersecurity firms will likely become industry standards.

For builders and investors: Everybody can learn from how Bybit handled the situation. Absolute masterclass of crisis management → quick admittance, clear communication on the situation, and clarity on the next steps. It’s also incredible to see how quick the industry unites over this situation.

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PRODUCT OF THE WEEK

Kanye West’s Memecoin & Blockchain?

Kanye West, now known as Ye, has stirred controversy with a series of erratic crypto posts (now deleted) teasing the launch of a token dubbed "Swasticoin" next week.

• In his posts, Ye made inflammatory remarks, including offensive comments aimed at the Jewish community.

• Ye stated that he would initially open the token's contract address to select groups.

• He also queried about various blockchain networks and attempted to contact Changpeng “CZ” Zhao.

• Meanwhile, conflicting reports suggest that Ye might instead launch a different project called YZY—reserving 70% of its supply for himself.

• There remains uncertainty about whether the token will launch as planned or if he might shift his focus to more ambitious projects like his own blockchain.

Other cool products:

• Limitless, a new prediction market on Base.

• 10kswap, an AMM protocol on Starknet Mainnet.

• XBR Protocol, a DeFi ecosystem on major EVM blockchains.

• GLOBAL GAINS, a BNB staking platform with refund system.

• Hashstack, a permissionless zk-native money market protocol.

CHARTS OF THE WEEK

US Spot Bitcoin ETFs Volume Surpasses $750B

State of play: US spot Bitcoin ETFs have achieved a cumulative trading volume of over $750B, just a little over a year after their January 2024 debut.

• Early rapid growth saw volumes hitting $100B by March and $200B by April amid Bitcoin's surge to nearly $74,000.

• Renewed market momentum propelled volumes reaching $750B by the close of trading in the latest session.

• BlackRock’s IBIT has become the dominant player, expanding its market share from ~25% at launch to over 75%, outperforming established ETF products.

Our take: Longing BTC dominance is the trade indeed.

$KAITO Hits $1.7B FDV Post-Airdrop

State of play: Kaito's native token $KAITO reached a fully diluted market cap of $1.7B following an airdrop to community “yappers” and subsequent listings on CEXs.

• Initially, influential crypto figures who claimed the airdrop quickly sold their tokens, causing a drop from $1.40 to about $0.90. However, the token rebounded to $1.96.

• Kaito distributed 10% of its 1B-token supply through the airdrop, with nearly 29% claimed by over 71,000 accounts—though most received fewer than 50 tokens.

• Notably, one wallet claimed nearly 560,000 tokens, and several prominent holders, including Zion Thomas and Mert Mumtaz.

Our Take: InfoFi is a new category that Kaito is trying to convey as a narrative. I think this has legs, but need to continuously iterate so they don’t just become a sub-category of DeFi (speculation on information).

QUICK BITES

• Infini exploited for $49M.

• SEC ends OpenSea probe.

• $KAITO hits $1.7B FDV post-airdrop.

• eXch denies money-laundering allegations.

• Kanye West claims he'll launch 'Swasticoin' next week.

• 0xFun dismisses insolvency claims amid JefeDAO feud.

• mETH Protocol announces $43M recovery from Bybit hack.

• Arbitrum DAO proposed to invest 7,500 ETH in non-native projects.

• Raydium's $RAY drops 22% amid speculation of PumpFun own AMM.

• Arkham Exchange plans to offer spot trading to 17 US states in March.

NOTEWORTHY READS & MEME

• Teng Yan’s read on dynamic TAO.

• Decentralised’s read on the framework wars.

• Austin Campbell’s read on that colossal wreck.

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Disclaimer: All the information presented in this publication and its affiliates is strictly for educational purposes only. It should not be construed or taken as financial, legal, investment, or any other form of advice.