On The Brink with Castle Island Weekly Roundup 02/28/25 (Bybit Hack, SEC drops lawsuits, bank-issued stablecoins) (EP.599)
Feb 28, 2025
This week, the cryptocurrency world faces shockwaves from Bybit's staggering $1.48 billion hack, marking the largest breach in history. Meanwhile, new regulations see the SEC abandoning lawsuits against major platforms like Coinbase and Robinhood. The debut of a yield-bearing stablecoin approved by the SEC raises eyebrows, as does Bank of America's potential entry into the stablecoin market. Additionally, MicroStrategy's bold Bitcoin investment and discussions around the implications of the Bank Secrecy Act on DeFi highlight the evolving landscape of finance.
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Episode notes
Engage with the SEC
- Go to the SEC website and review recent statements, especially Hester Peirce's "There Be Some Way Out of Here."
- Engage with the SEC's crypto task force if you have a perspective on regulatory guidance.
Bybit Hack Magnitude
- The Bybit hack, resulting in a $1.4B ETH loss, is the largest in crypto history, possibly the largest financial theft ever.
- This hack highlights systemic risks within the crypto market, particularly concerning exchanges as custodians.
Bybit Hack Mechanics
- Bybit's hack involved a compromised Gnosis Safe UI, misleading Ledger hardware wallets during transactions.
- The inability to fully verify Ethereum addresses on Ledger's UI contributed to the vulnerability.