US Court Backs Bybit’s Bid to Trace $1.5B North Korea Hack Funds
Vexoda Newsroom
A federal judge has granted crypto exchange Bybit expedited discovery to trace assets stolen in a massive hack linked to North Korea, aiming for the recovery of funds.
In an important legal development, US courts have backed cryptocurrency exchange Bybit’s efforts to recover $1.5 billion from a North Korean-linked hack by granting it expedited discovery rights. This decision allows Bybit to seek account identities and transaction histories from exchanges with US operations that may hold traceable assets.
Bybit filed the lawsuit on June 18, targeting not only North Korea but also its Reconnaissance General Bureau (RGB) and the Lazarus Group along with other unidentified defendants. The court expedited discovery proceedings on June 19, enabling Bybit to pursue a portion of the stolen funds that remain traceable.
The hack occurred on February 21, 2025, after attackers compromised Safe Wallet’s infrastructure using stolen credentials belonging to a developer. Forensic investigators later attributed the theft to North Korea. Bybit claims that only 9.8% of the stolen assets are still traceable, down from 68.57% in early 2025.
Bybit is seeking approximately $1.5 billion in compensatory damages and additional punitive damages under the US Racketeer Influenced and Corrupt Organizations Act (RICO). The company has also obtained a temporary restraining order to prevent unidentified defendants from transferring traceable assets, with this order renewed on July 16.
This legal move by Bybit highlights the ongoing challenges in tracing and recovering stolen cryptocurrencies. It underscores the complexity of dealing with cybercrime involving sophisticated tactics like mixing services and cross-chain bridges that make funds untraceable.
The broader implications are significant for both exchanges and regulators. This case could set a precedent on how to effectively pursue legal action against large-scale crypto hacks, potentially influencing future protocols and security measures in the industry.
Traders should be aware of ongoing developments related to Bybit’s lawsuit as it progresses. Key watchpoints include any further court rulings, cooperation from other exchanges, and potential changes in regulatory frameworks for crypto asset recovery.
Source: Cointelegraph. Summarized and rewritten by the Vexoda Newsroom. This is market news, not financial advice.