The Good Tech Companies - How Bybit Rebounded from a Major Hack & Regained Market Share: A Dive into Block Scholes’ Report

Episode Date: April 10, 2025

This story was originally published on HackerNoon at: https://hackernoon.com/how-bybit-rebounded-from-a-major-hack-and-regained-market-share-a-dive-into-block-scholes-report. Bybit's swift recovery after a major hack highlights its use of RPI orders to stabilize liquidity, says new Block Scholes report. Check more stories related to web3 at: https://hackernoon.com/c/web3. You can also check exclusive content about #web3, #blockchain, #cryptocurrency, #block-scholes, #bybit, #bybit-news, #good-company, #cybersecurity, and more. This story was written by: @ishanpandey. Learn more about this writer by checking @ishanpandey's about page, and for more stories, please visit hackernoon.com. Bybit's swift recovery after a major hack highlights its use of RPI orders to stabilize liquidity, says new Block Scholes report.

This audio is presented by Hacker Noon, where anyone can learn anything about any technology. How Bybit rebounded from a major hack and regained market share? A dive into Blockskull's report, by Aishan Pandey Hash hash hash newspaper How did Bybit recover so quickly after a major hack? When a major cryptocurrency exchange faces a hack, the aftermath can often last for months, if not years. So how did Bybit, the world's second largest crypto exchange by trading volume, manage to regain market confidence and recover trading volume within weeks? A new report by digital asset research firm Block Skolls

explores the incident and what it calls a, sharp but brief, liquidity disruption on Bybit, analyzing the exchange's market recovery through technical indicators, spot data, and peer comparisons. The data reveals a combination of early infrastructure deployment and tactical innovations aimed at protecting retail traders. A short-lived disruption, the immediate aftermath in the wake of the hack, Bybit saw trading volumes drop and order book depth thin out. BlockSkolls attributes this to both a security breach and a non-going market downturn.

However, the disruption was temporary. The report states greater than, while the hack triggered a sharp but brief disruption in volumes and order greater than book depth, particularly in the BTC and ETH markets, bid ask spreads across greater than major tokens remained largely intact. Bybit's ability to keep bid-ask spreads stable despite thinner order books hinted at an underlying mechanism countering the market volatility. That mechanism, the report shows, was already in motion before the hack even took place. What is RPI and why did it matter? Retail price improvement, RPI, orders, rolled out just days

before the hack, became central to Bybit's recovery. RPI, orders, rolled out just days before the hack, became central to Bybit's recovery. RPI is designed to provide retail traders a better price execution by building a separate liquidity pool. Institutional and algorithmic traders are excluded from this channel. Greater than, aided by the timely rollout of retail price improvement, RPI, orders, Bybit greater than stabilized liquidity conditions and began to rebuild its share of overall greater than crypto spot trading, the report noted. This design allows everyday users transacting through the Bybit interface to access deeper liquidity, often getting a better deal than automated OR institutional traders.

According to the data, by late March, RPI orders made up more than 50% of the order book depth at key price points in assets like BTC, ETH, SAAL, and DOGE. The RPI pool is built with three layers of liquidity, bid and ask, enhancing both price discovery and execution speed. According to Bybit's internal analytics greater than, RPI orders dominated price zones within 5-10 basis points of the mid-price, greater than accounting for up to 30% of the liquidity in those levels. For retail traders, this translated into tighter spreads and more favorable execution conditions, even in post-incident volatility. Learn more about RPI orders on Bybit.

Market share recovery and liquidity metrics Bybit's share of the spot trading market dropped to 4% following the hack but recovered to 7% by early April, according to Block Skolls. The exchange also restored healthy order book depth and normalized spreads on its major pairs, including BTC USDT and ETH USDT. Technical indicators tracked during this period included three stall liquidity measurements, a metric that evaluates available depth across three price levels. Block Skoll's analysis shows RPI orders consistently improved liquidity at these levels. Greater than, the order book metrics returned to pre-incident benchmarks within a week, greater than the report said. This is a relatively fast timeline in the aftermath of a cyberattack, especially considering

the typical hesitancy among market makers and large traders following breaches. View full Bybit data from February 24 to April 1, 2025 peer comparison and the bigger picture compared to other exchanges that have experienced similar disruptions, Bybit's response stands out for its use of technical tools to protect retail order flow. Where other platforms may rely on external liquidity providers or restrict trading after hacks, Bybit took the opposite approach, enhancing access and reducing friction. BlockSkolls study benchmarks Bybit against peers by analyzing liquidity recovery curves. While the names of competing exchanges are anonymized in the public version of the report,

the relative slope of Bybit's recovery curve suggests a steeper rebound than most. This raises questions about whether retail-focused tools like RPI might become standard across other centralized exchanges. A smart play with RPI, but sustainability remains the question Bybit's handling of the crisis shows the strength of having systems like RPI in place, not just as product features, but as strategic safeguards. The exchange's ability to quickly normalize market behavior without resorting to heavy PR or marketing spin is notable. Bybit must maintain a careful balance between retail friendliness and institutional participation.

The bigger challenge is ensuring that such innovations aren't just reactive but form part of a proactive resilience strategy. Crypto markets are volatile by design. Exchanges that can evolve their liquidity infrastructure without waiting for crises will likely lead the next era. Final Thoughts Bybit's recovery provides a compelling case study in crypto market resilience. With the help of technical innovations like RPI, the exchange managed to stabilize order books and regain lost ground in a matter of weeks. The Block Skoll's report offers a rare view into how deep liquidity mechanics and strategic tooling can shape post-crisis outcomes in digital finance. In a sector prone to turbulence, the lesson here is clear.

Infrastructure, no-thipe, is what carries platforms through the storm. Don't forget to like and share the story. Tip Vested Interest Disclosure. This author is an independent contributor publishing via our business blogging program. Hacker Noon has reviewed the report for quality, but the claims herein belong to the author. Hashtag dyo. Thank you for listening to this Hacker Noon story, read by Artificial Intelligence. Visit HackerNoon.com to read, write, learn and publish.