Bybit’s market share has rebounded to pre-hack levels following a $1.4 billion exploit in February, as the crypto exchange implements tighter security and improves liquidity options for retail traders.

The crypto industry was rocked by its largest hack in history on Feb. 21 when Bybit lost over $1.4 billion in liquid-staked Ether (stETH), Mantle Staked ETH (mETH) and other digital assets.

Despite the scale of the exploit, Bybit has steadily regained market share, according to an April 9 report by crypto analytics firm Block Scholes.

“Since this initial decline, Bybit has steadily regained market share as it works to repair sentiment and as volumes return to the exchange,” the report stated.

Block Scholes said Bybit’s proportional share rose from a post-hack low of 4% to about 7%, reflecting a strong and stable recovery in spot market activity and trading volumes.

Bybit’s spot volume market share as a proportion of the market share of the top 20 CEXs. Source: Block Scholes

The hack occurred amid a “broader trend of macro de-risking that began prior to the event,” which signals that Bybit’s initial decline in trading volume was not solely due to the exploit.

Related: Can Ether recover above $3K after Bybit’s massive $1.4B hack?

It took the Bybit hackers 10 days to launder all the stolen Bybit funds through the decentralized crosschain protocol THORChain, Cointelegraph reported on March 4.

Source: Ben Zhou

Despite efforts, 89% of the stolen $1.4 billion was traceable by blockchain analytics experts.

Related: THORChain generates $5M in fees, $5.4B in volume since Bybit hack

Lazarus Group’s 2024 pause was repositioning for Bybit hack

Blockchain security firms, including Arkham Intelligence, have identified North Korea’s Lazarus Group as the likely culprit behind the Bybit exploit, as the attackers have continued swapping the funds in an effort to render them untraceable.

Illicit activity tied to North Korean cyber actors declined after July 1, 2024, despite a surge in attacks earlier that year, according to blockchain analytics firm Chainalysis.

The slowdown in crypto hacks by North Korean agents had raised significant red flags, according to Eric Jardine, Chainalysis cybercrimes research Lead.

North Korean hacking activity before and after July 1. Source: Chainalysis

North Korea’s slowdown “started when Russia and DPRK [North Korea] met for their summit that led to a reallocation of North Korean resources, including military personnel to the war in Ukraine,” Jardine told Cointelegraph during the Chainreaction show on March 26, adding:

“So, we speculated in the report that there might have been additional things unseen in terms of resources reallocation from the DPRK, and then you roll forward into early February, and you have the Bybit hack.”

https://t.co/jOlqMt4Hag

— Cointelegraph (@Cointelegraph) March 26, 2025

The Bybit attack highlights that even centralized exchanges with strong security measures remain vulnerable to sophisticated cyberattacks, analysts said.

The attack shares similarities with the $230 million WazirX hack and the $58 million Radiant Capital hack, according to Meir Dolev, co-founder and chief technical officer at Cyvers.

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The Synthetix protocol’s native stablecoin, Synthetix USD (sUSD), fell to its lowest value in five years, extending a months-long struggle to maintain its $1 peg.

The asset has faced persistent instability since the start of 2025. On Jan. 1, sUSD dropped to $0.96 and only rebounded to $0.99 in early February. Prices continued to fluctuate through February before stabilizing in March.

On April 10, sUSD fell to a five-year low of $0.83, according to data from CoinGecko.

SUSD is a crypto-collateralized stablecoin. Users lock up SNX tokens to mint sUSD, making its stability highly dependent on the market value of SNX.

1-month price chart of Synthetix USD stablecoin. Source: CoinGecko

Synthetix USD’s “death spiral” risks

When the sUSD token dropped to $0.91 on April 1, Rob Schmitt, the co-founder of the risk tokenization platform Cork Protocol, explained the potential “death spiral scenario” of the stablecoin. 

Schmitt said the stablecoin’s design shares similarities with Terra’s TerraUSD (UST) stablecoin, which collapsed in 2022. While he noted key differences in collateralization and debt management, Schmitt said the fundamental risk remains:

“The death spiral scenario remains the same though, if the value of SNX drops sufficiently, sUSD is no longer fully backed. If fear of sUSD being unbacked triggers users to redeem sUSD for SNX and sell this, it creates further downwards pressure on SNX, creating a cascading deleveraging event.”

Despite the concern, Schmitt emphasized that such a collapse is unlikely due to Synthetix’s $30 million treasury, which holds about half of the outstanding sUSD debt. He said this reserve could be deployed against a spiral scenario.

“The biggest factor why sUSD won’t death spiral is because the Synthetix treasury hodls about $30 million of sUSD, which is about half the outstanding debt. To avoid a death spiral, this sUSD can be unwound,” Schmitt wrote. 

Synthetix founder Kain Warwick previously responded to the dips, saying that while he had feared a death spiral during the last seven years, he sleeps “great” these days.

He explained that the dips happened because the primary driver of sUSD buying had been removed. “New mechanisms are being introduced but in this transition there will be some volatility,” Warwick wrote. 

The Synthetix founder added that since sUSD is a pure crypto collateralized stablecoin, the peg can drift. However, the executive said there are mechanisms to push it back in line if it goes above or below its peg. “These mechanisms are being transitioned right now, hence the drift,” Warwick added. 

Cointelegraph approached Warwick for further comment but had not heard back by publication. 

Related: Ukraine floats 23% tax on some crypto income, exemptions for stablecoins

Stablecoin loses dollar peg amid market sell-off

Apart from sUSD, another stablecoin has also recently strayed from its dollar pegs as the crypto market has seen downturns. On April 7, Synnax Stablecoin (syUSD) dropped to $0.94. The project said concentrated sell activities temporarily caused a “slight deviation” from its dollar peg. The project said it was working on implementing a fully open redemption system. 

Magazine: 3 reasons Ethereum could turn a corner: Kain Warwick, X Hall of Flame

Institutional crypto investment firm Bitwise has doubled down on its big Bitcoin price prediction for this year despite escalating global trade tensions.

“In December, Bitwise predicted that Bitcoin would end the year at $200,000. I still think that’s in play,” Bitwise chief investment officer Matt Hougan said in an April 9 blog post. 

He suggested that the fallout from US President Donald Trump’s global tariff push could be beneficial for Bitcoin (BTC) and crypto because his administration “wants a weaker dollar, even if it means ending its role as the world’s reserve currency.”

Hougan cited an April 7 speech by Steve Miran, chairman of the White House Council of Economic Advisers, which criticized the dollar’s reserve status as causing “persistent currency distortions” and “unsustainable trade deficits” that have “decimated” US manufacturing.

Hougan said a weaker greenback could have both short-term and long-term implications for Bitcoin. 

In the short term, dollar weakness historically correlates with Bitcoin strength, he added, citing the US Dollar Index (DXY). 

“Dollar down equals Bitcoin up,” Hougan said. “I expect this pattern will continue.”

BTC prices have generally been historically high when DXY has been historically low. Source: MacroMicro 

The DXY, which compares the value of the US dollar to a basket of six major currencies, has fallen more than 7% since the beginning of 2025, according to TradingView. 

In the long term, Hougan said disruption to the global reserve currency system creates opportunities for alternative reserve assets, including Bitcoin and gold. 

“Governments and companies turn to the dollar for international trade precisely because of its stability. When that stability comes into question, they have to look elsewhere.”

The Bitwise executive concluded that the world will move from a single reserve currency to a “more fractured reserve system, with hard money like Bitcoin and gold playing a bigger role than it does today.”

Earlier this week, VanEck said that China and Russia were reportedly settling some energy trades in Bitcoin as Trump’s trade war ramps up.

On April 9, Trump issued a 90-day pause on nearly all of his earlier announced “reciprocal tariffs,” keeping a baseline 10% tariff on all countries besides China, which he lumped with a 125% tariff.

Bitcoin will be the fastest horse 

Crypto trader and analyst Will Clemente said on X that “Bitcoin will be the fastest horse” coming out of this drawdown. 

Related: Most opportune time to buy Bitcoin? Now — Bitwise CIO Matt Hougan explains why

“It’s a pure reflection of liquidity and no earnings, if anything, economic uncertainty/deglobalization are positive for Bitcoin,” he added. 

BTC is up 7.5% over the past 24 hours to $81,700. It has seen a correction of around 32% from its Jan. 20 all-time high, in line with pullbacks in previous bull market cycles.

Magazine: 3 reasons Ethereum could turn a corner: Kain Warwick, X Hall of Flame