After Bybit was hacked by the North Korean hacker group Lazarus and lost about 500,000 ETH (worth $1.46 billion) on the 21st, the community has been in heated discussion about whether to rollback (revert to a certain Block) the Ethereum Blockchain to freeze the stolen funds.
Arthur Hayes supports rollback
Yesterday, BitMEX co-founder Arthur Hayes tweeted: Why not rollback Ethereum to help Bybit? After the DAO incident in 2016, the Ethereum community has already abandoned the "immutability" of the network, so why not do it again? He stated:
If the community wants to do it again (rollback the chain), I will support it.
No one has a problem with CZ's computer (referring to the $BNB ecosystem), so why not let $ETH become Vitalik's computer?
Additionally, there were even rumors that the Ethereum Foundation was about to vote on whether to rollback, but this news has been debunked.
Further reading: Fake! The rumor that Vitalik Buterin will initiate a vote to "rollback" Ethereum to save Bybit from the hack is not true
Core developers warn: Rollback of Ethereum is unrealistic, risking an unresolvable chain reaction
However, Ethereum core developer Tim Beiko outlined 4 points to explain why the Bybit hack cannot be rolled back:
1) No violation of Ethereum protocol
- The Bybit hack was due to the compromise of a multi-signature management interface, leading to transactions being wrongly signed, which is different from the smart contract vulnerability in The DAO.
- From the perspective of the Ethereum protocol, these transactions are completely legitimate and cannot be distinguished from normal transactions.
2) Hackers immediately moved the funds, making it impossible to freeze
In the TheDAO incident, the funds were frozen for a month, but the assets stolen from Bybit immediately flowed on the chain, with the hackers using DeFi protocols, DEXes, and cross-chain bridges to quickly obscure the source of the funds, making any attempt to "rollback" extremely difficult.
3) The chain reaction caused by rollback is huge
- Ethereum is deeply integrated with exchanges, DeFi, and RWA.
- Any "rollback" could affect other applications' settled transactions (e.g., exchange sales, RWA redemptions), with a scope far exceeding The DAO incident, causing an almost unresolvable chain reaction.
4) Past attempts to "rollback" were strongly opposed by the community
- In 2018, EIP-999 proposed to revert the 500,000 ETH frozen due to a Parity Wallet error, but was strongly opposed by the community and ultimately did not pass.
- This shows that the community's stance on "changing the history of the Blockchain" has become more conservative, and even if it is technically feasible, they are unwilling to make such changes.
Tim Beiko emphasized that the past Bitcoin and Ethereum rollback cases were carried out under special conditions, and the current level of Ethereum's application integration and the community's pursuit of immutability make "rollback" unrealistic.
Yuga Labs VP: The cost of rollback is far greater than $1.5 billion
Yuga Labs' Blockchain VP 0xQuit also held the same position, stating that the impact of a rollback would be far greater than the $1.5 billion lost by Bybit:
Ethereum can indeed be rolled back (Bitcoin can also be, as long as you get majority consensus).
But the impact of doing so would be far beyond $1.5 billion. Thousands of innocent users would lose their funds, and thousands would gain money that doesn't belong to them. If you want to consider all the important participants, like Circle and Tether, those institutions might collapse. The chain reaction of a rollback is unpredictable, because unlike the DAO era, Ethereum is no longer a simple network of smart contracts and "Hello World".
He emphasized that Ethereum is now the core of DeFi, the settlement layer for many Rollups, and this infrastructure cannot be simply "rewound".
Bybit CEO: Should be decided by community vote
Additionally, in a Spaces AMA, when Bybit CEO Ben Zhou was asked if he supports rolling back the Ethereum Blockchain to invalidate the funds stolen by the Lazarus Group, he responded:
This may not be something that a single person can decide. According to the spirit of Blockchain, perhaps it should be decided by a community vote, but I'm not sure.
Review of The DAO incident
The DAO incident was one of the largest hacker attacks in Ethereum's history in 2016, and was the first event that led to a split in the community. The DAO was a decentralized investment fund based on smart contracts, which had raised about $150 million in ETH (about 15% of the total ETH supply at the time), but was hacked due to a "Reentrancy Bug" vulnerability, resulting in the theft of 3.6 million ETH (about $60 million).
In order to recover the funds, the Ethereum community ultimately chose to perform a "hard fork", transferring the stolen assets back to the original holders' accounts, but this move sparked controversy, with some opponents insisting on maintaining the original chain, ultimately forming Ethereum (ETH) and the Ethereum Classic (ETC) chain that insists on immutability.
