Good news for cryptocurrency investors arrived just after 8am on Friday. Coinbase, the largest US crypto market, has signed a contract with US regulators to dismiss a long-standing lawsuit with the industry.
But within hours, the crypto market was in a new crisis. At 10:51am, another major crypto exchange, BYBIT, said it had been hacked. Industry analysts estimate the loss of nearly $1.5 billion, the biggest theft in the history of the code.
Prices for Bitcoin, ether and other major cryptocurrencies have plummeted. Even Coinbase's stock price fell 8% by the end of the day.
This split-screen contrast was an illustration that spoke about the state of the cipher in 2025. Even though President Trump accepts the industry, he is prone to fraud, theft and sudden market meltdowns, and remains a wild west of the financial world.
A series of policy changes in Washington have poised to encourage millions of investors to dabble on crypto despite the industry's ongoing struggle to continue police and prevent criminal activity. It's in place. Huck reminded us that codes remain internationally free because of all its growing influence in politics. This is a chaotic market where even the most experienced investors can suffer extreme losses.
“These people who are all business wise about these issues have lost $1.5 billion,” says Corey Frayer, who worked on crypto policy for the Securities and Exchange Commission during the Biden administration. I did. “So how do you expect a normal American who wants debit cards to work to use their products safely?”
News about Coinbase and Bybit came at the end of a few days of roller coasters in the crypto world. It prompted widespread complaints about fraud – digital currency based on internet jokes and celebrities mascots without practical features.
Javier Mairay, a mimecoin promoted by the Argentine president last week, suddenly saw its value surge, causing a political crisis there, costing investors more than $250 million.
Recently, Crypto executives have expressed concern about the spread of these high-risk cryptocurrencies, and are worried that the industry could cancel some of its progress with lawmakers. Shortly before his inauguration, Trump sold his own memo coins – it shot value before crashing. Over 800,000 crypto accounts have lost their money.
“Memecoin isn't just a casino. It's even worse,” wrote Haseeb Qureshi of Crypto Venture Investor on social media this week. “Each slot machine has a different ownership, each trying to tear you as much as possible before moving to the next slot.”
Under the Biden administration, federal regulators oversaw a widespread crackdown on crypto and filed lawsuits against many of the industry's many companies.
At the top of that list was Coinbase, a $60 billion company that was published in 2021. Two years ago, the SEC sued Coinbase, claiming that the digital currencies sold on the platform are securities, as well as stocks and bonds trading on Wall Street. . Regulators argued that Coinbase must register with the SEC and follow strict rules to protect investors from financial harm.
But when Trump took office, the government's attitude towards codes changed. The president has his own crypto business, World Liberty Financial, which gives him a personal interest in the success of the industry. He then appointed securities lawyer Paul Atkins, an ally of the crypto industry, to lead the SEC.
In a regulatory filing Friday morning, Coinbase announced that the SEC agreed to withdraw the lawsuit without imposing financial penalties. (A contract requires approval by the agent's commissioner, a process that is expected to be formal.)
In a celebration social media post, industry executives have declared the end of a “siege against cryptography” by the federal government.
The happiness didn't last long. Based in Dubai and processes tens of billions of dollars in daily transactions, Bybitt revealed that the burglars violated the system and stole a large amount of ether.
Crypto has a long history of damaging hacking, but theft from Bybit warned previous records in 2021 when a burglar stole $601 million in cryptocurrency from a platform called Polynetwork.
Even outside the crypto world, there are few precedents of theft. “It could even be the largest single theft ever,” said Tom Robinson, co-founder of crypto analytics firm Elliptic.
On social media, Bybit CEO Ben Zhou has assuranced customers that the company is still a solvent. “Even if the losses from this hack have not been recovered, all client assets are supported by 1-1,” he writes. “You can cover the loss.”
In a live stream on Friday, Zhou, who swiged Red Bull, said the “impacted amount” was 401,000 ether, or about $1.1 billion. Crypto Forensics experts estimated the total to nearly $1.5 billion based on an analysis of public transaction records.
BYBIT does not serve U.S. customers, according to its website. Company representatives did not immediately respond to requests for comment.
Crypto Research Group's Arkham Intelligence said North Korean hackers were behind the Bibit violation. The attacks by North Korean groups have been plaguing the industry for many years.
Bitcoin prices fell 5% early on Friday, slightly above $100,000 to $95,000. Other cryptocurrencies have fallen even further.
And Coinbase's celebration day ended with a sharp fall in the stock market. By the time the market closed on Friday, the stock was trading at its lowest price since November.
