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The ByBit Hack: Why it could never happen with OneBalance
Tens of billions have been lost—whether through outright hacks or shady misappropriation—by centralized exchanges like Mt. Gox, FTX, and countless others. This time, ByBit lost $1.5 billion to North Korea's Lazarus group due to a blind signing exploit.
Fortunately, users didn’t suffer. ByBit managed the panic well, absorbed the losses, and ensured users were able to withdraw their funds from the exchange in the aftermath..
But what happens next time when another centralized entity gets exploited? How many more wake-up calls do we need before things change? At what point do we finally accept: not your keys, not your crypto?
Sadly, 90% of users still prefer CEXs over self-custody as it's the most convenient and easy option for users. This speaks volumes about the state of onchain UX.
The only way to change this is to make onchain feel better than CEX 💪
What went wrong with ByBit? 👀
The ByBit hack, like so many before it, was possible because of a single, fatal flaw: centralized custody. The hacker didn’t need to break into hundreds of individual accounts - they only needed to compromise a few key systems to gain access to a massive amount of assets (and that’s putting it lightly).
This is the same weakness that led to the collapse of FTX, the Mt. Gox disaster, and countless other exchange failures. Whenever a centralized entity holds billions in user assets, it becomes an irresistible target. Worse, it can create a single point of failure. Breach that point, and it’s game over for everyone.
In this case, due to a vulnerability in the Safe frontend, hackers tricked ByBit’s security team into signing a malicious transaction, allowing them to take control of all user ETH on ByBit!
Could this happen to you? Yes.
But CEXs and other large entities are prime targets because of their massive holdings and potential points of failure that attract attackers. Just look at the $600m Ronin Network attack if you are searching for more examples.
Your security is only as strong as your weakest link. If a CEX doesn't exercise best practices, then your funds are at risk.
OneBalance: A non-custodial future 🫡
So how does @OneBalance_io solve this? By eliminating the very thing that makes CEXs vulnerable: centralized custody. We make it easy to bring every user onchain.
OneBalance’s Chain Abstraction Toolkit allows users to seamlessly transact across chains without dealing with onchain complexities. Users get a unified balance that can be instantly spent across any chain in a single click. It’s like CEX but without the risks.
✅Key Difference #1: No operator can steal your funds
With OneBalance, users retain custody of their assets while only trusting an exchange operator to facilitate trades - not hold their funds.
An exchange operator like ByBit could leverage OneBalance to build a non-custodial exchange, enabling trade execution without asset custody. This makes it physically impossible for an exchange operator to misappropriate user funds, whether due to hacks, mismanagement, or fraud.
✅Key Difference #2: No single point of failure
In the ByBit hack, attackers compromised a single centralized system and walked away with $1.5b. If ByBit had been using OneBalance, they could eliminate the centralized point of failure.
Why? Because in a OneBalance-powered exchange, there is no centralized pot of money for hackers to steal.
Each user’s funds remain in their own wallets, meaning an attacker would need to individually compromise every single user to replicate the damage done in this hack. That’s exponentially harder to pull off, making these kinds of attacks impractical.
✅Key Difference #3: Rage quit mechanism
Applications built on the OneBalance stack will always have a ragequit mechanism for their users, ensuring they are completely self-custodial.
This means that if OneBalance is suddenly no longer in operation or the user suddenly has a reason not to trust any party in the stack, they can immediately leave without requiring any approval.
Users keys = users funds. The way it should be.
Why this matters for your users
For years, crypto users have been forced to choose between security and usability. CEXs are easy to use, but they come with massive risks. Decentralized exchanges (DEXs) are safer but often lack the smooth user experience traders expect.
Users do care about security, and they would use DEXs if we can get the UX right. Look at Hyperliquid and its adoption, it’s a testament to the demand of DeFi applications with the right UX.
With OneBalance, every DeFi application can replicate the CeFi experience.
We enable DeFi UX, which is just as easy to use as ByBit, Binance, or Coinbase, but without the security trade-offs.
🚫No more CEX-style collapses where operators misuse customer funds
🚫No more exchange-wide hacks draining user balances
🚫No more trusting a middleman with your assets
It’s like CEX but without the risks.
Conclusion: The future of secure crypto trading
Crypto was meant to be trustless. Yet, time and again, we see major exchanges and other centralized entities falling to the same mistakes - centralized custody, single points of failure, and massive security breaches.
OneBalance offers a different path: a world where you trade without ever giving up control of your assets. This hack could not have happened if ByBit had been built on OneBalance.
It’s time for crypto to evolve beyond outdated models. The future of trading is unstoppable, trustless, and hack-resistant.
The future is OneBalance.
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