Article author: Yueqi Yang Article compiled by: Block unicorn

Last week, hackers were the third largest encryption in the world The currency exchange Bybit stole $1.4 billion, and then other cryptocurrency exchanges, which are competitors, made moves to help Bybit stabilize its financial situation. The cryptocurrency industry hopes to ease investors' concerns by using the move that the hack could lead to a recurrence of a crash like FTX.

Several exchanges, including Bitget and MEXC, have provided emergency loans to Bybit to supplement the lost tokens in the hacker attack, ensuring Bybit's customers can Funds were withdrawn smoothly. These loans are unusual because they are arranged quickly and easily, without a lengthy due diligence process, and with few strings attached. By contrast, its founder Sam Bankman-Fried had sought funds extensively in the cryptocurrency industry and Wall Street to fill loopholes and made accounts public to potential investors before and after the FTX crash in 2022.

According to Bitget CEO Gracy Chen, smaller rival Bitget lends 40,000 yuan to Bybit about five hours after the hacker attack on Friday Ethereum, worth more than US$105 million. The terms of this loan are exceptionally friendly to borrowers because it charges no interest, does not require Bybit to provide any collateral, and does not set a repayment period. "It's more based on pure trust," Chen said.

Another rival cryptocurrency exchange MEXC also offered loans. Despite the $1.4 billion funding gap caused by hackers, the loans have allowed Bybit to allow customers to withdraw funds, alleviating the potential crisis Bybit that could swell the wider cryptocurrency market. However, emergency loans have also deepened the financial link between Bybit, Bitget and MEXC, which could have a ripple effect between these companies if problems recur.

However, cryptocurrency industry participants believe that emergency loans are necessary to build investors' trust in the entire cryptocurrency ecosystem.

In an interview, Chen said that the hacker attacksAfter his lifetime, Bitget Board members immediately contacted Bybit CEO Ben Zhou to arrange a bridge loan. Chen said Bitget evaluated Bybit's exposure and believed that the exchange had the ability to repay the loan, and estimated that the funds stolen from Bybit would be equivalent to its profit for a year.

Chen said of Bybit: "We are familiar with each other and have common investors. We hope to jointly promote the development of the industry and fight against common enemies- Hackers, not compete with each other. ” Chen also said Bitget won’t acquire any equity in Bybit because of the loan.

Some large clients have also promised to support Bybit by maintaining or increasing trading positions. For example, Suji Yan, founder of the cryptocurrency project Mask Network, said that although he and his team immediately withdraw some of the funds after the hack, he went to Bybit from his personal and Mask Network accounts to Bybit on Saturday after talking to the Bybit executives. About 3,000 Ethereum were deposited.

A representative of Binance, the world's largest cryptocurrency exchange, said that Binance has been in touch with Bybit since the hack and provided Technical support for network security. Bybit CEO said in an interview with cryptocurrency blogger Colin Wu that the company has not borrowed money from Binance because it has borrowed enough funds from other companies.

Cybersecurity researchers say Bybit's hacking is likely to originate from North Korea's affiliated hacker group. The incident highlights the risks faced by global investors, despite Trump’s new cryptocurrency regulation. Bitcoin and Ethereum prices have fallen more than 5% since Bybit’s disclosure of the hack, and Coinbase shares have fallen 8% on Friday.

On Sunday night, Bybit's Zhou said the exchange had supplemented the stolen Ethereum and had enough cryptocurrency to fully cover all customer accounts. He thanked Bitget, MEXC and other companies, including Galaxy Digital and Antalpha Global, a Singapore lender linked to Bitcoin mining giant Bitmain.

ZhouThere is no specific explanation of what kind of support Bybit has received from each company. Representatives for Galaxy Digital did not immediately respond to a request for comment. Antalpha also could not be reached for comment immediately.

As of Monday, Bybit's total assets had dropped to $11.8 billion, with traders withdrawing about $6 billion, according to DefiLlama. A report by cryptocurrency analysis firm Kaiko shows that liquidity on the exchange has declined. Nevertheless, Bybit has successfully dealt with the crisis so far without turning off customer withdrawals.

Dubai-based Bybit, as well as Bitget and MEXC, are offshore exchanges that are technically prohibited from U.S. users, and they offer high leverage perpetual futures contracts, which are attractive to cryptocurrency users, are illegal in the United States. All three exchanges are growing rapidly, thanks in part to the collapse of FTX, which provides other offshore exchanges with the opportunity to seize market share.

Bybit and Bitget both list cryptocurrency venture capital firm Dragonfly Capital as minority shareholders. “Everyone knows that blocking North Korea’s actions and allowing users to trust decentralized infrastructure is more beneficial to the industry,” Haseeb Qureshi, managing partner at Dragonfly, said in an email. … An attack on one side is to everyone. ”

MEXC has never disclosed the name of its current CEO or controlling shareholder. But according to a person familiar with the matter, the shareholder also owns stake in Bitget. MEXC also announced a strategic partnership with Bybit in 2021, aiming to "work closely" to serve users and jointly create a blockchain ecosystem.

As asked when Bybit will repay the loan, Bitget's Chen said: "My expectations are that once any short-term liquidity crisis is resolved, they will Will pay us back, so it may be within a few days. ”