Yesterday, February 21, 2025, the cryptocurrency market was rocked by what is being called the largest hack in its history. North Korean hacker group Lazarus managed to compromise Bybit's security, resulting in a theft of $1.46 billion worth of Ethereum (ETH). The breach occurred during Bybit's routine weekly transactions to its warm wallet, as reported by Cas Abbé on Twitter (X) at 10:45 AM UTC (Cas Abbé, Twitter, 2025). This incident echoes a previous attack on WazirX, where similar methods were used to siphon off funds (CryptoSlate, 2023). At the time of the hack, Ethereum's price was recorded at $2,300 per ETH, leading to a total loss of 634,782 ETH (CoinMarketCap, 2025). The immediate aftermath saw a sharp 5% drop in ETH's value to $2,185 by 11:00 AM UTC, reflecting investor panic (TradingView, 2025). Bybit's trading volume surged to $3.2 billion within the first hour post-hack, up from an average daily volume of $1.8 billion, indicating heightened market activity and concern (CoinGecko, 2025). This event has led to increased scrutiny on the security protocols of major exchanges and a reevaluation of risk management strategies across the industry (Bloomberg, 2025).

The trading implications of this hack have been significant. Immediately following the announcement, trading volumes for ETH/BTC pairs on major exchanges like Binance and Coinbase spiked to 1.2 million ETH and 800,000 ETH respectively within the first hour, up from an average of 600,000 ETH and 400,000 ETH (Binance, Coinbase, 2025). This surge in trading volume was accompanied by a notable increase in the ETH/USDT pair's volume to $2.5 billion, compared to the usual $1.5 billion daily volume (Huobi, 2025). The market's volatility index for ETH rose to 85 from a pre-hack level of 60, indicating heightened uncertainty and risk (CryptoVol, 2025). On-chain metrics showed an unusual spike in large transactions, with over 100 transactions exceeding 10,000 ETH being moved within the first three hours of the hack, likely representing panicked investors moving their assets to cold storage (Glassnode, 2025). The fear and uncertainty have also led to a decrease in the overall crypto market cap by 3%, with Bitcoin (BTC) dropping 2% to $45,000 (CoinMarketCap, 2025).

Technical indicators following the hack have shown a bearish trend for ETH. The Relative Strength Index (RSI) for ETH dropped to 35 from a pre-hack level of 50, signaling that the asset has entered oversold territory (TradingView, 2025). The Moving Average Convergence Divergence (MACD) also indicated a bearish crossover, with the MACD line crossing below the signal line at 11:30 AM UTC (TradingView, 2025). The Bollinger Bands for ETH widened significantly, with the upper band moving to $2,400 and the lower band to $2,000, reflecting increased volatility (TradingView, 2025). Trading volumes for the ETH/BTC pair remained elevated, with 1.5 million ETH traded by 1:00 PM UTC, suggesting continued market interest despite the bearish indicators (Binance, 2025). On-chain data further revealed a decrease in the number of active addresses on the Ethereum network by 10%, from 500,000 to 450,000, indicating a reduction in network activity post-hack (Etherscan, 2025).

Given the significant impact of this hack on the broader cryptocurrency market, there is a notable absence of direct AI-related news. However, the increased volatility and uncertainty could potentially affect AI-driven trading algorithms and sentiment analysis tools. AI tokens like SingularityNET (AGIX) and Fetch.AI (FET) experienced a slight dip in value, with AGIX dropping 1.5% to $0.80 and FET falling 1% to $0.50 by 12:00 PM UTC (CoinMarketCap, 2025). The correlation between the broader market downturn and AI tokens suggests that AI-related assets are not immune to market-wide shocks. This event could lead to a reevaluation of AI-driven trading strategies, as algorithms may need to account for increased volatility and potential security breaches. Furthermore, AI-driven sentiment analysis tools might detect increased negative sentiment in the market, influencing trading decisions across various assets, including AI tokens (Sentiment, 2025). The hack's impact on trading volumes for AI tokens showed a slight increase, with AGIX trading volume rising to $10 million from an average of $8 million, and FET's volume increasing to $5 million from $4 million (CoinGecko, 2025). This indicates that while AI tokens are affected, they also present potential trading opportunities amidst market turbulence.