SafeWallet Reinvents Security After $1.5B Bybit Hack

BriefBits Crypto: This week's most important developments in Crypto world

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Discover how crypto’s evolving security, national strategies, and market moves are shaping the future of digital finance.

In today's edition:

SafeWallet revamps security after a massive Ethereum hack exposes human vulnerabilities.
Kazakhstan prepares a groundbreaking crypto reserve fueled by gold and seized assets.
Crypto markets rally with surging privacy coins and innovative DeFi platforms gaining traction.

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Security

Bybit Hack Spurs SafeWallet to Overhaul Security Architecture Amid Rising Crypto Threats

Briefly: Following a record $1.5 billion Ethereum theft orchestrated by the North Korean Lazarus Group, SafeWallet has reengineered its entire security infrastructure to address critical vulnerabilities exposed by the attack, focusing on layered defenses and mitigating social engineering risks.

Key Information:

Hackers infiltrated a SafeWallet developer’s machine to inject malicious JavaScript that bypassed Bybit’s multisignature approval, leading to the massive ETH theft.
SafeWallet’s CEO Rahul Rumalla calls the breach a ‘reckoning moment,’ prompting a multi-layered security redesign covering transaction, signer device, infrastructure, and compliance layers.
Social engineering remains the most persistent attack vector, with Lazarus Group exploiting communication channels like Telegram and company chats to gain insider access.
Despite the breach, SafeWallet’s core protocol and smart account technology remained secure, enabling ongoing development of secure yet user-friendly self-custody solutions.

Regulation

Kazakhstan Eyes $1 Billion Crypto Reserve Backed by Gold, Forex, and Seized Assets

Briefly: Kazakhstan plans to create a $500 million to $1 billion state-managed cryptocurrency reserve by converting parts of its National Fund, gold, foreign exchange reserves, and confiscated assets, aiming to launch by early 2026 and further integrate crypto mining into its economy.

Key Information:

The government intends to operationalize the crypto reserve fund by late 2025 or January 2026.
Confiscated assets from illicit activities will be included in the crypto reserve.
State-owned entities may supply energy to private crypto miners in exchange for cryptocurrency.
Kazakhstan is simultaneously developing a CBDC and stablecoin with partners like Solana and Mastercard.

🏃 Speedy Crypto Bytes

SecurityGoogle flagged five AI-powered malware families exploiting large language models to dynamically modify malicious code, with North Korean groups using these tools to target crypto wallets and execute sophisticated phishing attacks.

DeFiLeverUp launched a new decentralized perpetuals exchange on Monad blockchain offering up to 1001x leverage, zero trading fees, and unlimited market depth by eliminating traditional liquidity providers.

InvestmentBit Digital boosted its Ethereum holdings to about 153,547 ETH worth $590 million, staking 86% of it to earn nearly 3% annual yield, marking a strategic pivot from Bitcoin mining to Ethereum yield operations.

RegulationJapan’s Financial Services Agency endorsed a collaborative project among top banks to issue yen-backed stablecoins, aiming to modernize corporate payments and boost productivity while maintaining user protection and transparency.

MarketFilecoin soared 70% past $2 amid a rally in decentralized physical infrastructure networks, highlighting growing investor confidence in decentralized storage despite mixed crypto market conditions.

EducationMy First Bitcoin ended its El Salvador school program to shift focus towards global Bitcoin education via open-source materials and remote tools, reflecting changes in the country's crypto stance amid IMF agreements.

📈 Numbers and Trends

Bit Digital holds 153,547 ETH valued at $590.5 million, with 86% staked generating a 2.93% annual yield.
Filecoin surged 70% breaking above $2 amid a rally in decentralized physical infrastructure networks.
Privacy coins rose with Zcash up 76% to $632 and Dash jumping 130% to above $107 in one week.
Stablecoins have seen transactions exceed $265 billion, empowering over 1.4 billion unbanked adults globally.
Traditional hedge funds show 55% exposure to crypto, allocating on average 7% of portfolios with 71% planning to increase holdings.

💬 Quote of the Day

Bitcoin is the gold standard of digital capital, offering gold-like scarcity and a finite supply of 21 million coins as a hedge against currency devaluation and geopolitical risks.

Eric Trump, Co-founder of American Bitcoin Corp.

American Bitcoin reaches 4,004 BTC in strategic reserve

1️⃣ Number of the Day

$265 billion - Transaction volume of dollar-backed stablecoins

Dollar-backed stablecoins have surpassed $265 billion in transaction volume, highlighting their growing role in reinforcing the US dollar's dominance and enabling financial inclusion in developing countries by providing stable, accessible digital currency alternatives.

Stablecoins strengthen the dollar and empower the developing world

SafeWallet Reinvents Security After $1.5B Bybit Hack

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