Introduction: An Unprecedented Crypto Theft and Governance Crisis

On the early morning of February 22, 2025, the world's leading cryptocurrency exchange Bybit experienced the largest-scale crypto asset theft in history. The hacker group Lazarus Group, through highly sophisticated attack methods, transferred nearly $1.5 billion worth of ETH and stETH assets from Bybit's cold wallets. This incident not only exposed the vulnerabilities in the crypto industry's technical security and operational standards, but also triggered a core controversy over blockchain governance: should the Ethereum blockchain be rolled back to reverse the hacker attack?

Bybit CEO Ben Zhou's public statement after the incident - "According to the spirit of the blockchain, perhaps it should be a voting process" - escalated this controversy. From technical feasibility to community consensus, from the conflict between decentralization ideals and real interests, this debate touches on the fundamental contradictions in the crypto world.

Event Review: How did the hackers breach the "absolutely secure" cold wallets?

1. Cold Wallet Breach: Overturning Industry Security Perceptions

The traditional view is that cold wallets (offline private key storage) are the ultimate guarantee of asset security. However, the breakthrough in this attack was not the leakage of private keys, but the tampering of the front-end interface of the multi-signature wallet (originally Gnosis Safe) used by the Bybit team. The hackers used Trojan horses or DNS hijacking to induce Bybit team members to unknowingly sign a "upgrade contract" transaction, handing over wallet control. This method is known as the "pinnacle of social engineering attacks", the core of which is to exploit the trust blind spots in human operations, rather than technical vulnerabilities.

2. Lazarus Group's "Professionalism"

The criminal history of the hacker group Lazarus Group is astonishing: from the theft of 4,000 BTC from Youbit in 2017 to the $620 million loss from the Ronin cross-chain bridge in 2022, and now this incident, their cumulative stolen amount has exceeded $2.5 billion. Unlike ordinary hackers, Lazarus Group is known for its state-sponsored background, combining APT (Advanced Persistent Threat) attacks and a deep understanding of the crypto ecosystem. For example, in this case they quickly converted stETH and other liquid tokens into native ETH, avoiding the risk of stablecoin freezing while increasing asset concealment.

3. Market Reaction: Abnormal Stability in Panic

Although the scale of the incident far exceeded the 2016 The DAO hack (a loss of $50 million), the crypto market only experienced a brief decline. Ethereum price stabilized quickly after a 6.7% drop, and Bitcoin's decline was less than 3%. This abnormal stability stems from two factors: first, the market expects the hackers will not immediately dump the assets (it is difficult to launder such a large amount); second, exchanges like Binance and Bitget quickly provided 50,000 ETH in liquidity support, easing the redemption panic.

Rollback Proposal: The Dual Interrogation of Technical Feasibility and Governance Ethics

1. The DAO Precedent: Ethereum's "Original Sin"

In the 2016 The DAO incident, the Ethereum community rolled back transactions through a hard fork to recover the stolen funds, but also split off the Ethereum Classic (ETC) that insists on "code is law". This decision remains the most controversial governance case in crypto history. BitMEX founder Arthur Hayes brought up the old issue in this incident: "Since we've already voted against immutability in 2016, why not roll back again?" This view believes that Ethereum's governance has already accepted the legitimacy of human intervention.

2. Technical Feasibility: The Cost and Impossibility of Rollback

Although some community members have called for a rollback, it is technically almost impossible. Ethereum's current market cap exceeds $300 billion, with an ecosystem covering DeFi, NFT, Layer2 and other fields, involving hundreds of millions of smart contracts. If rolled back to the state of February 21, not only would the hacker's transactions be reversed, but all legitimate transactions would also be reversed - including the settlement of BlackRock's ETH spot ETF, exchange withdrawals, on-chain lending liquidations, etc. This "indiscriminate reset" would lead to a chain reaction of legal and financial disasters.

3. Governance Ethics: Who has the right to decide the fate of the blockchain?

Ben Zhou's proposed "community voting" seems to be in line with the spirit of decentralization, but it implicitly contains contradictions:

- Conflict of Stakeholder Interests: Bybit users want to recover their losses, but non-Bybit users may oppose sacrificing the entire network for a single platform.

- Risk of Centralization of Power: If the Ethereum Foundation or miners/validators dominate the voting, it will violate the "de-trustification" principle.

- Slippery Slope Effect of Precedents: Once rollback becomes the norm, the immutability of the blockchain will be in name only, undermining its foundation as a store of value.

Community Split: The Core Arguments of Supporters and Opponents

1. Three Reasons Supporting Rollback

- Moral Obligation: The blockchain community has a responsibility to protect user assets, especially when the attackers are state-sponsored hackers.

- Economic Rationality: A $1.5 billion loss may trigger systemic risk, and rollback is "taking the lesser of two evils".

- Historical Consistency: The DAO incident has proven rollback to be a feasible option, and should not be treated differently.

2. Four Positions Against Rollback

- Technical Irreversibility: Ethereum's scale and complexity make rollback a "nuclear option" with costs far exceeding the benefits.

- Decentralization Principle: The authority of the blockchain should come from the code, not human voting, otherwise it will become a replica of the traditional financial system.

- Legal Risks: Reversing legitimate transactions may lead to lawsuits, especially the contract liquidation of institutional investors.

- Market Trust Crisis: Frequent intervention will undermine investors' confidence in the blockchain's censorship resistance.

Alternative Solutions: Beyond Rollback, How Can the Crypto Industry Address Massive Thefts?

1. On-chain Tracing and Asset Freezing

By marking the hacker's addresses through blockchain analysis companies like Arkham and Elliptic, and coordinating exchanges and DeFi protocols to freeze the related funds. However, Lazarus Group typically uses mixers and cross-chain bridges, making tracing extremely difficult.

2. Bounty Programs and Negotiations

Bybit has announced rewards for providing clues, and is trying to contact the hackers. Such measures have successfully recovered $611 million in the 2021 Poly Network incident, but their effectiveness against state-backed hacker groups is doubtful.

3. Insurance and Liquidity Assistance

Exchanges can temporarily alleviate redemption pressure through "bridge loans" from peers (like the 50,000 ETH provided by Binance). However, this industry mutual aid model is difficult to scale.

4. The Paradox of Regulatory Intervention

Although the U.S. Treasury has proposed including crypto hackers in anti-terrorism sanctions, the cross-border nature of the decentralized ecosystem limits the effectiveness of law enforcement. Moreover, stronger regulation may further erode the autonomy of the crypto industry.

Conclusion: Seeking a Balance Between Immutability and Human Nature

The Bybit incident once again proves that the blockchain does not exist in a technological utopia vacuum. When $1.5 billion in assets are suspended between code and human nature, the community must face a cruel question: what kind of crypto world do we really want?

If we choose to roll back, we may save one exchange, but will undermine the foundation of the blockchain; if we insist on immutability, we must bear the moral burden of the huge losses. Perhaps the real solution lies not in the either-or choice, but in building a more robust security system and a more flexible governance framework - making the code strong enough to withstand attacks, and the community wise enough to accommodate human nature.