Bybit Hack Exploiter Launders Money by Issuing Meme Tokens on Pump.fun

In the aftermath of Bybit's $1.4 billion loss — the world's largest crypto exchange hack — many once-celebrated services are struggling to control the laundering of criminal proceeds.

Crypto exchange Bybit suffered a $1.4 billion hack on Feb. 21, making it the largest crypto exchange hack to date.

In the aftermath of the hack, customers rushed to withdraw over $4 billion in deposits. However, Bybit was able to secure some loans, and as of approximately 12 hours ago, claimed to have replenished liquidity to back customer deposits on a 1:1 basis.

Over the past three days, hackers have swapped and liquidated some of the proceeds of their crime. In a game of whack-a-mole, leaders of supposedly decentralized or permissionless protocols rushed to manually intervene.

Because many researchers have made credible allegations that the hackers have North Korean support, international sanctions might apply to those stolen funds.

Not only is preventing their money-laundering activities probably a moral thing to do, but failing to CFT/AML also implicates possible criminal prosecution.

Already, forensic researcher ZachXBT has claimed that hackers swapped over 37,000 stolen ETH for bitcoin and altcoins using exchanges with lax controls like ChainFlip, ThorChain, LiFi, DLN, and eXch. (Disagreeing with ZachXBT, eXch claims that it is “not laundering money for Lazarus/DPRK.”)

Bybit Exploiter is laundering money by issuing Meme tokens on pump fun. Bybit Exploiter: 5STkQy…95T7Cq transferred 60 SOL to 9Gu8v6…aAdqWS, who then launched a token called QinShihuang (500000), which has traded over $26 million. https://t.co/MYHInW4v3Z

Read more: Crypto exchange Bybit hacked for over $1.4 billion

Pump.fun administrators reportedly already removed a North Korea-linked token from its website after the state-sponsored Lazarus group transferred stolen Solana to a Pump.fun address.

Some administrators boasted of some preventative success. mETH Protocol managed to recover $43 million in stolen cmETH tokens. Tether froze $181,000 in USDT.

.@VitalikButerin will you advocate to roll back the chain to help @Bybit_Official ?

JAN3 CEO Samson Mow and BitMEX co-founder Arthur Hayes led calls to roll back the Ethereum blockchain to reverse the Bybit hack. However, Ethereum leader Vitalik Buterin didn’t acknowledge the plea and it was dismissed as trolling by Bitcoin maximalists who used the opportunity to recall Ethereum’s 2016 roll-back.

The Ethereum community rejected the recent proposal.

A Solana community member also called for a blockchain roll-back, citing money laundering through Pump.fun. He said there is plenty of precedent for at least pausing the Solana blockchain which has suffered dozens of historical outages. That recent proposal also died without attaining consensus.

Got a tip? Send us an email or ProtonMail. For more informed news, follow us on X, Instagram, Bluesky, and Google News, or subscribe to our YouTube channel.