DeFi Planet

Bybit Bounces Back: Kaiko Validates Fast Liquidity Recovery Post-$1.5B Hack

Dubai, UAE, May 7th, 2025, Chainwire

In the aftermath of the largest hack in crypto history, Bybit has emerged as a case study in market resilience, transparency, and user trust. A new independent report by Kaiko, a leading provider of institutional-grade crypto market data, reveals that Bybit’s liquidity rebounded to pre-incident levels within just 30 days—a feat unmatched by industry peers following similar crises.

On February 21, 2025, Bybit was the target of a coordinated cyberattack resulting in $1.5 billion in unauthorized withdrawals. While the incident sent shockwaves through the global crypto ecosystem, Bybit’s swift response and robust infrastructure ensured trading remained uninterrupted. In the weeks that followed, the platform’s liquidity, trading depth, and user confidence bounced back with remarkable speed.

A 30-Day Turnaround Led by Market Structure Innovation

According to Kaiko’s analysis, Bybit’s Bitcoin liquidity—measured by the 1% market depth—reached an average of $13 million per day by the end of Q1 2025, matching pre-hack levels. Liquidity recovered across all order book tiers, from 0.1% to 8% of the mid-price, underscoring deep institutional participation.

A key contributor to this recovery was the timely launch of Retail Price Improvement (RPI) orders on February 20, just one day before the attack. These orders, exclusive to manual traders on Bybit’s interface and inaccessible via API, are placed by institutional market makers to enhance pricing conditions for retail participants. In the volatile days post-incident, RPI orders helped stabilize trading, tighten spreads, and protect manual users from predatory algorithmic behavior.

Altcoin Market Strength and Narrowing Spreads

Liquidity recovery wasn’t limited to Bitcoin. Over 80% of pre-hack market depth for the top 30 altcoins by market cap was restored by March. Spreads across major tokens—including high-volatility assets like DOGE and XRP—tightened significantly, indicating improved execution costs and renewed market maker confidence.

Bid-ask spread volatility, a key indicator of market stress, also declined throughout March, signaling improved order book stability and increased participation from liquidity providers.

Volumes Recover Faster Than in Previous Crises

While broader market sentiment remained cautious amid macroeconomic uncertainty, Bybit’s trading volumes rebounded faster than after comparable shocks such as the 2016 Bitfinex hack or the 2023 Binance.US SEC case.

Kaiko’s data shows that hourly trading volume on Bybit briefly spiked to $1.2 billion immediately following the incident. Although volumes dipped in line with weekend trends, they have since normalized and begun climbing steadily—highlighting strong user retention and a growing sense of trust in Bybit’s market resilience.

Transparency as a Differentiator

One of the standout takeaways from the Kaiko report is Bybit’s transparency throughout the recovery process. While other platforms in similar situations have suffered prolonged liquidity deterioration, Bybit’s open communication and proactive market structure improvements helped it regain trust and stabilize conditions faster than the industry norm.

As the crypto market matures, exchanges are increasingly measured not only by performance during booms, but by how they respond to adversity. Bybit’s rapid liquidity rebound and commitment to user-centric innovation set a new benchmark for operational resilience in the industry.

#Bybit / #TheCryptoArk

About Bybit

Bybit is the world’s second-largest cryptocurrency exchange by trading volume, serving a global community of over 60 million users. Founded in 2018, Bybit is redefining openness in the decentralized world by creating a simpler, open, and equal ecosystem for everyone. With a strong focus on Web3, Bybit partners strategically with leading blockchain protocols to provide robust infrastructure and drive on-chain innovation. Renowned for its secure custody, diverse marketplaces, intuitive user experience, and advanced blockchain tools, Bybit bridges the gap between TradFi and DeFi, empowering builders, creators, and enthusiasts to unlock the full potential of Web3. Discover the future of decentralized finance at Bybit.com.

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