REKT Vision: Bybit Hacked for $1.4B | Are Meme Coins Dead?

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1:56Hello again for another episode of Wrecked Vision. it was actually gearing up to be a pretty good show until about an hour before we went live it looks like Bybit's been hacked just a few days after FTX we pay everyone$800 million we have our latest crypto exchange calamity Bybit has been hacked for over$1.4 million dollars. This is slightly surprising. This is probably the second biggest exchange in the world, arguably, in terms of volume. We can go into how it happened, but this has definitely had a bit of an impact. We've seen stuff dip around 3-5 % across Bitcoin and some of the majors. Yeah, it's crazy.

2:50I mean, the magnitude of this hack is about 1.4 billion dollars worth of ETH so it's a crazy crazy number it sounds like it was through like a spoofed multi-sig um transaction for people to sign which is really crazy because I think if you're at that level where you're signing things for you know that much under management you should obviously like check and read everything that you're doing it's I didn't really quite understand the nature of the hack but it sounds like people didn't realize what they were signing um i can give you i can give a little bit of a detail so please do ben benza who is the founder of five it's gone on um gone online and said firstly that we're one for one um we will this isn't going to take down by a bit although this is a crazy amount of money like all withdrawals will be fine everyone's money is fine hi raul here listen i think we've got until 2030 before the economic singularity arrives.

3:54Now, it might not be the exact date, but it's around then. So we have about six years to figure out how to unfuck our future. I've put together a report to help you called Prepare for 2030. It's going to help you take the first steps in that journey to make sure you're secure past 2030. So just click on the link below and start your journey now. I mean, trust, but verify, you can always take your money off by it. Like if you've got a large amount of funds on there but um he is basically saying that this is not going to be um like an ftx style hole let's say he is saying that it was a musk attack he's saying and i look at what a musk attack is a musk attack refers to a phishing technique where attackers create a perfect visual replica or legitimate interface in this case safe's multi-sig multi-sig wallet interface but the actual transaction data being signed is different from what's displayed it's similar to a fake ATM interface.

4:50The screen shows you're withdrawing 100 bucks, but the machine is actually programmed to take your whole balance. So I think they create almost like a fake site, safe site and a fake transaction. I don't know how that's happened, but this is clearly a very, very sophisticated hack. They had pre-warned everyone that they were going to move some of these funds from their hot wallet to their cold wallet. and then clearly a hacker has been given the heads up to create a very very detailed scam here but it says this is a particularly dangerous attack vector because even experienced users with hardware wallets can fall for it if they don't verify the raw transaction data the safe wallet interface was specifically targeted here since it's widely used by major institutions for secure storage makes you think right like um we're going to see some very sophisticated like safe like websites you need to be checking on your um yeah you need to be checking everything even even on safe which is like used by everyone it's crazy because you know safe is deemed to be the the thing that is like this is the safest way to manage large amounts of money you're going through there's no single point of failure like multiple people have to sign you would think if there's an issue like this, it would get caught somewhere along the lines.

6:11I don't know how many people had a signatory on this particular safe, but I would imagine it's at least three or four, if not more than that. So, yeah, I don't really know. I mean, I don't even really know how you're to blame as a signatory if the UI you're looking at just looks normal or is completely replicated to be spoofed and the URL is normal and fine as well. So yeah, that's kind of insane. It must be something that's happened internally, right? Because someone must have received the... Like I presume when they have something to sign, they have some sort of internal communication beforehand, which says, oh, hey, by the way, sign this.

6:55I don't think they just logged into the safe and saw, oh, here's something to sign. Let me just sign it without verifying it first. So it must be something that's happened internally, I'd imagine. Yeah, I honestly don't know. I think we'll find out a lot more data about this. Obviously, a hack this big, 1.4 billion, you have to assume it's someone very sophisticated. North Koreans are generally behind a lot of these. Interestingly, they've recently hacked in all different sorts of ways, but the worst ones we've seen in the past have been when people have got hold of private keys, things like the Ronin bridge hack.

7:33For example, to get$1.4 billion off-chain might be a little bit difficult. This is obscene amounts of money. So to even get that through a centralized exchange into a bank, I don't know how they got to do that. How do you do that? Well, Tornado Cash is now almost allowed. So they will be able to do that. but I would imagine this is such a big figure this is such a big figure that it probably just makes sense to do some form of bartering to get the money back like I'll keep 10-20 % you get the rest of it back I'm sure over the next two days we will hear some sort of message being passed from the hacker back to back to Bybit because I just feel like that's just an obscene amount of money to be able to get away with hacking.

8:28I don't know. If they get away with it, it's kind of bearish for the whole space because I think that's that is yeah, it's just so like that, you can just steal$1.4 billion like everyone's going to be trying it, you know? Yeah, I don't yeah, there's just no I'm trying to think how you get it out. Even Tornado Cash presumably the Tornado Cash guys realize something like that is coming and maybe they have some way to block it i don't really know no i mean they'd have to do it to thousands upon thousands of addresses right um and then all of those would have to basically take it out through a centralized exchange because that's where the majority of the on and off ramps are or i don't know maybe there's some other ways that they can do it in some way he's gonna have to find some some black market otc buyer who does that some crazy discount i guess well yeah knowing it's that i guess you're right like it's it's such a large amount of money it's basically impossible to really get it all out yeah but even you can't really negotiate with can you you can't just say okay you guys take back one bill i'll take 500 mil then like how you're gonna get that out you can um i mean often they'll say we won't prosecute you know if if we get their funds back that sort of stuff um i've seen it happen oh for smaller amounts but like smaller amounts yeah you know you you keep 140 mil that's it's pretty nice uh yeah yeah uh so have you ever wanted to trade bitcoin but haven't dared try with plus 500 futures you can trade crypto without the hassle of opening a wallet with just a few clicks you can register and start practicing with their free and unlimited demo.

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10:51Visit us.plus500.com to learn more. Trading in futures involves the risk of loss and is not suitable for everyone. Not all applicants will qualify. Plus 500, it's trading with a plus. Yeah, I'm trying to think that like what the hacker must be thinking at this stage, like imagine getting hold of that and being like it works i've got 1.4 billion dollars um crazy and the other side of that is the is the the people who signed the transaction like can you just imagine the moment where it shows it's being moved out of the account and you're just like what has happened here uh not good to think about for sure so is this like good or bad for the market i mean obviously the knee jack reaction is things should sell off but i see a lot of people talking about the fact that by a bit may potentially have to buy back the 1.5 billion worth of e they're not able to recover it to replenish what they lost i guess um well this is they're selling the eath they've sold about 200 to 300 million dollars so the initial move was lower but i agree like the next move might have to be that by the have to buy it back um I think the obvious moves here would be people might take more money off centralized exchanges.

12:09I saw literally two minutes ago that Binance came out with an even higher yield on their stablecoin. So they're clearly scared that people might just move tons of funds off centralized exchanges off the back of this. That's the general knee-jerk reaction when one of these exchange things happens. similarly like some of the DEXs might gain market share so like a sort of a bunch of people who are because Bybit is known for spot but it's really known for perps right it's really known for perps so Hyperliquid for example is actually up on the back of this because people are expecting even more volume to kind of move to them which I think is which makes a lot of sense to be honest although I wouldn't say Hyperliquid is like squeaky clean in terms of its security process either.

12:57Lots of different vulnerabilities potentially there. So I don't know. I just think people will probably just take a pause. There's normally like a 24-hour is like, oh God, how is my own personal security doing here? Maybe I shouldn't be doing that. Yeah, it's kind of a crazy amount. I think with AI as well, this stuff is only going to become more and more sophisticated, isn't it? we're only starting to scratch the surface of how crazy AI is going to be at hacking the stuff that we do so and crypto is like fair game for just a crazy amount of this sort of hack but I don't know let me have a look total number amount hacked in 24 this has got to be hacked in crypto this has got to be Yeah, so$2.2 billion was stolen in 2024.

13:53So this is almost, this is about 75 % of what was stolen in all of 2024. It's been stolen just now. So pretty big figure. Yeah. I'm curious to see how this plays out. I mean, we've grown into it a little bit because the market was feeling pretty good until then, if I'm honest. And ETH was actually outperforming. On the week, we bring up the weekly moves. ETH had had one of its best weeks in a long, long time. And normally when ETH rallies, the rest of the market pukes. But ETH had been up about 4 % on the week. Bitcoin had been up about 2%, 3%. And Solana actually had been down about 10%. And post this, Bitcoin's again higher than ETH on the week.

14:46So I think people were calling for like altcoin season. You know, ETH is suddenly now breaking out versus Bitcoin after just being downtrodden for so long. And interestingly, it was starting to beat Solana by a decent amount. And I think this is probably short term. I don't think this is like, this really isn't going to take down ETH. But it is annoying to be an ETH holder and feel like, you know, stuff's starting to move. Things are starting to look good. And now you've got a guy who's selling, you know, at least a billion dollars, potentially, more to go. It's not that good. Remember, we kind of had that with FTX, the FTX hacker.

15:27Do you remember? Whenever, like, they used to swap ETH. ETH used to get smashed lower. That was just after the FTX collapsed. Do you remember that? Yeah. Yeah, and everyone was watching when they sold and all this sort of stuff, and it wasn't good. So maybe this is a little bit of an overhang for Ether, which I don't think people will be that happy about. But nevertheless, it did feel like that was the general trend. It did feel like the market was feeling pretty good. Bitcoin was heading back to 100K, and we were starting to see – it felt terrible middle of the week, but by the end of the week, you know, it felt a little bit better.

16:13What's your views? I know you're a Bitcoin maxi these days but you have been dancing around a little bit in some other stuff. What's your take on how the market dynamic is shifting a little bit here? I think you're starting to see, obviously I've been very Bitcoin maxi-ish for a while. I think you're starting to see pockets of altcoin performance, L1 performance out there, things that aren't just Bitcoin have been rallying this week and doing well interestingly it's not really memes and I think after the, I mean we haven't even spoke about the whole Libra stuff and I guess we'll cover it but it's crazy that was still like less than a week ago but I think after that and a lot of these extraction type meme coins it's funny because we on the show would talk about the whole narrative was like oh old coins are bad because VC's getting really low and they just dump on you as the resting schedules unlock and you're the one left holding the bag.

17:08And meme coins were like the fight against that. Whereas now with like the last 90 % of meme coins, it's just insiders who, you know, club together on the stuff and then end up dumping on you as a retail investor. So it feels like it's now as if it's once again switched back. And indeed, there are some altcoins that are doing pretty well in the last week or so. Story Protocol, which spoke about Sonic today, which is Phantom, Barachain, Aptos. There's been a few of them. So I just wonder now whether, I don't think it's like a carte blanche for all coins, but I just wonder now whether like some more serious, even AI coins are up a decent amount in the last few days.

17:54I just wonder if there's now more return to some of these coins and perhaps in situations where something like Hyperliquid, where it was, I think they didn't even raise capital, right? There's no real VC involvement. Yeah. But there's also no, they're not being extractive, if that makes sense, like many coins are these days. So I think a coin with a good story like that can do really well. Like actually a good use case, good utility. So back away to mid curving or ideally right curving some of this stuff, but also a good narrative where it's not just like, oh, here's all the VCs again, I think.

18:37So we maybe go into that a little bit because, you know, this time last week, Libra hadn't happened, right? Which has kind of been seen as a bit of the final nail in the coffin for, well, not nail in the coffin, but it's definitely put a break on the Solana Casino. So this was, we've been speaking before that about the hyper rotation, you know, new coin each week. And that Trump, after Trump, you'd have Melania and then you had a bunch of other celebrities come in and do kind of ump and dump style coins. And no one wanted to hold anything because there was just a new coin each day and you needed to buy the daily runner.

19:18This time last week, yeah, the Libra coin came out, which is from the Argentinian president, Mille. and he did it. One of the more crazy, crazy stories in crypto, right? He seems to have done it alongside a LA-based token launching group led by... Head Adams. No. Head Adams, right? A young guy who is just a bit gormless, right? Completely gormless. who seemingly was behind Milania and a few other coins. This coin initially went up to around$4.5 billion after it launched. Everyone was going crazy. Now, this is the new Trump. I can't believe Argentina launched a coin. And it quite quickly became apparent that 95 % of the tokens were owned by insiders, which wouldn't unlock completely.

20:16They could sell at any time. and that a bunch of people had been given kind of a heads up on this and that then it quickly started to fall. And then I think around a billion dollars, just under a billion dollars, Miele deleted his tweets and said he wasn't part of it. And it went all the way down to$300 million. Since then, there's been a bit of back and forth about whether he was involved or how much he was involved. But in the political side, he's definitely under pressure from this. But I think the main takeaway was that what you just said is that it suddenly just felt like there'd actually been this, the casino had been rigged for a little bit here.

20:57And it actually engulfed some of the major Solana protocols. The main one being Meteora that's been behind the Trump launch, the Melania launch, and this launch, and seemingly had been using this group to launch a few of these different coins and potentially profited from it as well. There's a lot of debate about whether these big protocols were involved in something like the insider trading around it. A bunch of influencers, KOLs, were revealed to kind of know about this and perhaps have gotten free allocation. Dave Portnoy said he was given free allocation, but like sent it back, but then was given$5 million because of his trading losses.

21:36It all kind of stunk on many different levels, and there was a bit of a witch hunt afterwards because it kind of felt like it had been revealed, the sort of scammingness of what had been going on. And since then, Solana DeFi volumes are down about 50 % to 60%. Solana dropped from trading at around 205 % all the way down to 160 % pretty soon after this happened. and a lot of the protocols on there also fell just because meme coin trading, this sort of casino spirit had been such a big part of Solana's activity. Maybe not 100 % its culture, but that was driving so much of its activity. What do you make of all that?

22:25Like, do you think, firstly, yeah, what are your thoughts about the coin? What happened? And then what do you think of the implications? it's just this is not the first time the same people have done this trick where you get someone who is really big or famous or important to sort of like bless the coin and i think what they tell javier mille maybe is something like hey you can make some money out of this this isn't your coin but as long as you tweet about it people will assume that it's your coin it's all about it all seems to be about like can we get them to tweet about it um so uh once you have that then you know the rest of the market is like oh wow this is going to be like crazy ifdv coin and everyone just firms into it so what these guys have done is they've just been using these meteoropols where they just put in like a bunch of the tokens that they have as um it effectively becomes one-sided liquidity because they put in two-sided liquidity.

23:28It all rallies because everyone firm is into it and they pull the bid-side liquidity to monetize basically and then they've just extracted money from everyone. So it's pretty bad because I think in this situation there was a stat that I read which was $286 million of realized losses on this coin and if you looked at the top 10 or even top 20 they were all like mid to low seven figure losses realized not just like paper losses but realized losses so um i just think it got the market got to a point where people were maybe high off the trump trade or feeling coped from the trump trade and the amount of posts i saw in the timeline where people were just full porting this thing like you know putting oh here's my whole$3 million portfolio, put it all into this relay coin.

24:27And then just subsequently losing 50, 60, 70, 80, 90%, depending on where you got out is crazy, but it's sort of like a perfect storm, right? Like all of every time, not just crypto, but every time any market sells off is because there's been too much risk taken within the system. And that happens because of greed. People get too greedy and want to make as much money as possible. And here you have two sides of the fence. you have a bad actor being greedy and trying to, you know, extract this money from the retail market. And then you have like the entire retail market itself diving headfirst into it being greedy.

25:06And it's not even like, like, I think people realize maybe it's a scam. I'm not really sure. I don't really believe it's going to have longevity, but everyone just gambles to try and make that quick, like two, three, four, five, 10 X, right? So it's kind of what happened. Everyone lost their money. I don't know how this guy is going to get out of the$100 million right now that they have in these wallets. $110 million, yeah. He's talked about putting it back into the chart. The levels of illegality of what's going on here is kind of insane. I just think he obviously hasn't spoken to a lawyer or has no idea what's going on.

25:40But it's a big liquidity suck out of what I would say is the trenches, which kind of is the pool of capital that invests in mean coins. And so a lot of people sold their meme coins to buy this, lost their money on this, and that capital hasn't really flowed back into those meme coins. And like I said, this is happening over and over again. I mean, the scale of the losses of this one was probably the largest, but the same thing has happened with people. Trump did well, but it's still off. It's still, what, like down 60 % or 70 % from the highs. Like people have lost money on that. People have lost money on Melania.

26:15People have lost money on Enron. Jelly Jelly. like all these random coins that came out it's just probably the same group of two or three people coming in extracting the capital away out of retail retail takes the hit tries to make it back on something else and you know slow it's like that meme where you have the big wheel and this slightly smaller one the slightly smaller one like retail is slowly being drained of its of its capital and i think it's going to take a while for the market to recover and um i don't know maybe that's why you're also seeing like some bigger pools of capital feeling more confident to invest in alts or other things that aren't memes because now it's like oh well these are actually dead so i don't have to make that decision and you buy some of this other stuff now um i think it's all related really i i agree with that analysis almost almost completely like i think um i think this one was interesting because i think a lot of people did a huge amounts because there was and often it was like influencers and kols right because i think they'd been given a tip off um that this was going to come and and they'd done the trump playbook and then often those are the people that lost the most like a lot of people um lost quite a lot who were like um kols or kind of semi-insiders let's say um which is kind of kind of interesting around this one um but i do think people just feel as though like you said it's come to light that this this was almost like it a tried and tested method of taking money away from from retail um i hadn't been making any money on on the left curve stuff since trump um i i'd like that's when i kind of reduced it um into into more defensive plays because i just felt like i wasn't going to make money but a lot of people were still trying to play that hyper rotation you know don't own anything like i'll buy the daily runner i'll sell it at the top and i'll try and move on to the next one i think that people were losing a lot of money and then to see then that this came out that that was actually a rigged game despite a lot of a lot of key voices in the space telling you to like you know you need to buy the daily runner um i think i think that was that was painful for a lot of people and that's caused this massive backlash like it felt worst or around the same as ftx on on monday or tuesday in like the core ct community i think you kind of agree with that just because it also felt like all el all the old sold off in the back of this everyone just felt like because solana's been such a huge huge trade from from um from many angles of alts as well that people got very very frustrated but you kind of look at the market stables gone up to still going higher we've got 250 billion nearly of stables on chain right now.

28:58That wasn't really changing. It didn't look like we're heading to a bear market. It just felt like people were just done. They were done with the casino. And well, they were done with that room of the casino, let's say. We've now moved on to the new room, which appears to be altcoins and DGEN DeFi, which is kind of what we said at the start of the show. But what I've been seeing is a lot more of the 2021 DeFi crew being a bit more emboldened. A lot of like older faces starting to pop up. A lot of the newer faces from this cycle being a lot quieter. And a trend towards L1s with active ecosystems.

29:42This kind of started with some of the newer launches. So around this time last year, I don't know if you remember, but everyone used to buy the new launch, the new Binance coin, right? And we had some big runners in gaming and a few other different things. But it's kind of gone back there a little bit. Things like Story Protocol is up 150 % this week. There was a new coin, Kaito, which was a social platform coin. Pretty interesting one, actually, there. That's up to like 1.5, 2 billion. Payne did well, which was that other new coin, at least in the meme coin space, it suddenly just felt like, okay, now people are looking at new launches.

30:20That's where we're going to degen. And then some of the more established degen DeFi chains is where I see a lot of money moving. And those two are really bearer chain, which again is also a new chain. And Sonic, which is the one that I guess I think me and you have been looking at it a little bit more over the last 24, 48 hours. And I think it makes sense. You know, on these chains, there's often crazy casino-like DeFi yields. Like you can put it into LPs where you get thousands of percents and there's a huge rewards program, for example, going on in Sonic right now. And you can see that people are, there's funds moving from things like Solana and activity moving things like Solana into these chains.

31:11And you can see that in DEX volume, PERP volume, and TVL changes. I think Sonic's TVL has gone from under a million dollars to$700 million in a month. And you're starting to see price increases in these L1 coins about 50 % to 60%. But it's really the activity on the chain, which is the DGEN stuff, which people are being drawn to. I'm not saying I think this is like the next meta yet, but I don't think, I think that this could be the thing that people now start to get more involved in. And I think it could be a slightly different crowd. I think people have had enough of some of the influences from the last six months.

31:57And I think some of the more crazy stuff from the DeFi influences might suddenly become more attractive. what do you think osaf do you think do you think this trend of altcoins and new coins and then dj and defies is might be the thing that lasts with us for a month two months yeah i think a month or two months it could definitely happen i don't feel like it's strong enough to be a main circle narrative like you know dj and defy is not that easy to understand for the average person um number one number two if you're based somewhere like the uk or the us the tax implications of it are quite complicated as well so i think um for me it's um uh it's not the it's not something that will be like a main cycle narrative but i do think um it can dominate the timeline and people for about a month or so yeah maybe we'll talk a little bit about sonic because that's the one i I think interests me the most.

33:00This was Sonic is Phantom. If anyone remembers Phantom from last cycle, they did an upgrade to the chain. They rebranded. It's now doing 10K TPS. So that's at Solana or faster levels, obviously pre-Fired Answer, but it's the fastest EVM chain. It's an L1, it's not an L2, and was created by André Cronier, who is a pretty well-known kind of DeFi OG. and phantom was like the home of dgen defy in 2021 and they i think they're giving 300 million dollars worth of rewards roughly um over the next six months to people who are doing stuff on the chain um so so it feels like a lot of money has moved and i don't know i quite like some of these stories like that that maybe there's going to be i love solana like i i think it's more a culture a thing that's been shaken out here but i do think that people want to move away from it like they they want to go and do something else and and it's just the right time right place for something like this like um like bear a chain or or like sonic the fdvs of these sort of these chains is much lower you know um the ones that we've mentioned today sonic's at three billion I think Bearer chains are around four and a half and Story Protocol, which is very, very different, to be clear, I think is around four.

34:32But you compare that to like Sui at 30, you compare that to Solana at, what is it, 80 or 90 now? 90 maybe? 85. There is some room to run there. you know like if if if the tvl of these chains continues to go up and you continue to see like a building out of a community there those aren't the worst altcoin longs and there was a lot of talk of like you know this could be another bitcoin dominance is still at 61 so to say it's an altcoin season i think is it's kind of crazy but but it could be this pocket of altcoins could have a bit of a run here, which is the alt L1s, not Solana. And that may include ETH2, you know, barring today's disaster.

35:22But it feels as though there could be a movement away from some of the L1s that have done well so far, maybe Sui and Solana, into some of these newer, lower-cap ones with relatively established communities. Yeah, I think it doesn't take much to you told me about sonic this morning and i kind of just decided that to get involved doesn't it's not a difficult pitch to understand and i think it's something people can get on board with quite quickly whether it's i'm a bit um skeptical as to how long it lasts for like i'm i'm definitely skeptical of metrics such as TVL even volumes I'm skeptical of I think fuse generated is probably the best metric and provided that it shows some consistency in staying high I think it's interesting but other than that I think um I think it's something that can do well for a few weeks or something like that but I don't know if it's enough to dethrone the likes of Solana etc I mean, even with like finance smart chain, right?