Bybit freezes $30.5M after suing North Korea for $1.5B crypto hack

Bybit filed a lawsuit against North Korea on Tuesday, accusing the regime of stealing $1.5 billion in a crypto hack linked to the Lazarus Group, and secured a court order to freeze $30.5 million in stolen funds.

This is the latest escalation in a years-long battle between crypto platforms and state-backed hackers. Lazarus, a North Korean cybercrime syndicate, has stolen billions from exchanges over the past decade, using the proceeds to fund weapons programs and evade sanctions. Bybit’s case targets a February 2025 attack in which hackers exploited vulnerabilities in the exchange’s bridge protocol to siphon assets. So far, Bybit has recovered $48.4 million and frozen another $30.5 million, but the majority of the stolen funds remain untraceable, dispersed across mixers and shell wallets.

Court documents reveal the lawsuit was filed in the U.S. District Court for the Southern District of New York, a common venue for crypto-related litigation due to its expertise in financial crime cases. Legal experts say this move sets a precedent—if successful, it could encourage other exchanges to pursue similar actions against state sponsors of cybercrime. North Korea has long denied involvement in such attacks, but U.N. reports and blockchain forensics consistently tie Lazarus to high-profile heists, including the 2016 Bangladesh Bank robbery and the 2022 Axie Infinity hack.

The order to freeze assets is a small but symbolic victory. Most of the stolen cryptocurrency has already been laundered through services like Tornado Cash, making recovery unlikely. Still, the case signals that crypto platforms are willing to take legal action against sovereign actors, not just anonymous hackers. If Bybit can claw back more funds, it could pressure other exchanges to strengthen security and coordination with law enforcement. The bigger question remains: how many billions will be stolen before the industry and governments close the gaps that make these attacks possible.