Top on-chain analyst ZachXBT says that crypto will most likely fall into the hands of strict government regulations if it can’t figure out how to prevent hacks.
In a new post in his Telegram channel, the blockchain detective says his most recent work with the Bybit hack has given him some clarity on the crypto space.
“Spending long hours helping freeze funds for the Bybit hack has been eye opening.
This industry is unbelievably cooked when it comes to exploits/hacks and sadly idk if the industry is going to fix this itself unless the government forcibly passes regulations that hurt our entire industry.
Several ‘decentralized’ protocols have recently had nearly 100% of their monthly volume/fees derived from DPRK [Democratic People’s Republic of Korea] and refuse to take any accountability.”
ZachXBT says the problem doesn’t just lie with decentralized exchanges, noting that centralized exchanges’ know-your-customer (KYC) policies have proven to be essentially useless in preventing massive hacks and exploits.
“Centralized exchanges end up being worse as when illicit funds flow through them a few take multiple hours to respond when it only takes minutes to launder.
KYT (know-your-transaction) is completely flawed and easily evadable
KYC is just a honeypot for regular users bc of breaches/insiders and is useless in majority of cases due to purchased accounts.
DPRK laundering $1.4 billion from the recent hack has only exposed how broken it is.”
Bybit suffered the largest attack in crypto history last month, reportedly perpetrated by North Korea’s Lazarus Group.
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