Bybit Fintech Limited, a leading cryptocurrency exchange, is reinforcing its security infrastructure after suffering a massive $1.45 billion hack in February 2025. To address concerns over asset safety, Bybit has partnered with Zodia Custody, a firm backed by financial giants like Standard Chartered and Northern Trust, to provide institutional clients with a more secure way to store digital assets.
Bybit and Zodia Custody Strengthen Security Measures
The February attack, one of the largest crypto breaches in history, saw the North Korean Lazarus Group steal nearly $1.5 billion worth of Ethereum. The hack underscored major vulnerabilities in exchange security, prompting Bybit to take swift action to reassure investors.
Bybit’s new custody solution with Zodia Custody allows institutional clients to trade on the exchange while keeping their assets stored separately with Zodia. This innovative model minimizes risks by ensuring that funds are not directly held on Bybit’s platform, reducing exposure to future breaches.
Unlike traditional exchange wallets, which often mix customer funds, Zodia Custody follows a strict segregation model, preventing mismanagement or insolvency-related risks. This partnership introduces a new level of institutional-grade security, making Bybit more attractive to corporate investors.
Off-Venue Settlement: A Game-Changer for Institutional Investors
A key benefit of this partnership is the introduction of off-venue settlement. Traders and investors no longer need to pre-fund their Bybit accounts, as funds remain securely in custody until a trade is executed. This setup reduces exchange-related risks and enhances capital efficiency for institutional clients.
Zodia Custody operates under strict security protocols, including SOC-certified infrastructure, meeting the high standards of traditional financial institutions. Experts believe this move will instill greater confidence among institutional investors, encouraging more corporate adoption of cryptocurrency trading.
A New Era for Institutional Crypto Security
Bybit’s collaboration with Zodia Custody signals a broader shift in the crypto industry toward enhanced security standards. While some critics argue that increased corporate involvement may dilute the decentralized ethos of cryptocurrency, others see it as a necessary evolution to attract institutional capital.
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As cybersecurity threats and crypto scams continue to rise, exchanges like Bybit must prioritize security to maintain investor trust. By integrating Zodia’s custodial services, Bybit is setting a new benchmark for security in the institutional crypto trading space.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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