Non-KYC Exchange eXch Denies Helping Lazarus Group Launder Stolen Funds from Bybit Hack

Crypto exchange eXch has denied allegations of laundering money for North Korea’s Lazarus Group following the $1.4 billion hack on crypto exchange Bybit on February 21.

In a statement posted on the Bitcointalk forum on February 23, eXch addressed the claims, stating, “We are not laundering money for Lazarus/DPRK.”

The team assured that its operations remain unaffected and that all funds on the platform are safe.

eXch Admits Small Portion of Stolen Bybit Funds Passed Through Its Platform

While eXch denied involvement in large-scale laundering, it admitted that a small portion of the stolen funds passed through its platform.

“An insignificant portion of funds from the Bybit hack eventually entered our address 0xf1da…1123,” the statement read.

The exchange added that this was an isolated incident and that any fees collected from the transaction would be donated for the public good.

The comments came in response to growing accusations on social media and from blockchain investigators.

On February 22, on-chain analyst ZachXBT claimed that eXch had laundered $35 million from the Bybit hack and noted that 34 Ether (ETH), worth approximately $96,000, was mistakenly sent to another exchange’s hot wallet.

Other blockchain security firms have echoed these concerns.

SlowMist reported a significant amount of ETH being converted into other cryptocurrencies on eXch, while Nick Bax from the Security Alliance estimated the platform processed around $30 million in volume for the Lazarus Group.

⚠️Given the significant amount of ETH already laundered through eXch into BTC, XMR, etc., platforms should tighten risk controls on any funds coming from there.

— MistTrack🕵️ (@MistTrack_io) February 23, 2025

The Bybit hack is being described as the largest crypto theft in history, with attackers breaching Bybit’s Ether multisig cold wallet.

Following the incident, Bybit’s total assets have dropped by over $5.3 billion, including the stolen $1.4 billion, according to DefiLlama.

In an effort to recover the stolen assets, Bybit announced on February 23 that coordinated efforts have led to the freezing of over $42 million of the funds.

eXch Resists Bybit’s Request to Freeze Remaining Stolen Funds

Notably, eXch has shown resistance to Bybit’s requests to block the remaining stolen assets.

In a shared email with the Bybit risk team, eXch expressed frustration over what it claims are previous incidents where Bybit allegedly froze funds belonging to its users without adequate explanation.

“Why should we assist an organization that has previously undermined our reputation?” the eXch team questioned in the email.

Responding to the standoff, Bybit CEO Ben Zhou urged cooperation, emphasizing that the situation goes beyond individual companies.

“It’s about how we, as an industry, respond to hackers,” Zhou stated, hoping eXch would reconsider its position to prevent further outflow of the stolen funds.

At this point is really not about bybit or any entity, it's about our general approach towards hackers as an industry, really hope that @eXch can reconsider and help us to block funds outflowing from them. We are also getting help from Interpool and international regulatory… https://t.co/wRzN925X9l

— Ben Zhou (@benbybit) February 23, 2025

As reported, Zhou has pledged to pursue all possible avenues to recover the funds stolen during the recent hack linked to the Lazarus Group.

Speaking during a Feb. 22 X Spaces discussion, Zhou outlined the exchange’s strategy, which includes a bounty program, cooperation with law enforcement, and consultations with the Ethereum Foundation to explore potential solutions.