Crypto Exchange eXch Set to Close Following Claims Linked to Bybit Breach

The cryptocurrency network eXch has revealed it will officially halt operations on May 1, in light of accusations that it was utilized for money laundering related to the notorious Bybit breach.

This update was made public in a statement released on April 17, in which the exchange mentioned escalating pressure from regulators and a shared agreement among its leadership to retreat from the industry.

The situation revolves around allegations that North Korea’s Lazarus Group funneled around $35 million through eXch. This amount forms a part of the total estimated $1.4 billion that was taken in a significant attack targeting Bybit earlier this year.

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eXch Claims It’s Under Transatlantic Pressure Amid Legal Threats

eXch asserted it has become the subject of an “ongoing transatlantic operation” aimed at dismantling its framework and possibly filing legal actions against its executives.

Despite initial rejections, eXch later confirmed having processed a minor fraction of the hacked funds. The firm insisted that these transactions were “negligible” and maintained it had not purposely enabled illegal activities.

In the closure announcement, eXch condemned what it termed “an adversarial environment” fueled by misinterpretation of its privacy-centric operations. It claimed that ongoing surveillance measures, including signals intelligence (SIGINT), rendered further operation impractical.

“Although we’ve resisted numerous shutdown attempts, we find no benefit in operating under constant threat,” the company remarked.

Management underscored its dedication to user privacy and criticized other exchanges for enforcing what it described as “illogical policies” under the pretense of anti-money laundering.

eXch has confirmed they will cease all operations on May 1, 2025.

As a reminder, during the ByBit vulnerability breach, the Lazarus group utilized eXch to launder hundreds of thousands of dollars of stolen ETH. pic.twitter.com/dIXHhaZmUA

— vxdb (@vxdb) April 17, 2025

The repercussions of the Bybit breach, among the largest in crypto history, have been profound. User withdrawals exceeded $5 billion after the incident.

Initially, Bybit’s CEO Ben Zhou reassured users that the firm could manage the losses, but subsequently, the trading platform shut down its DIGITAL COLLECTIBLE marketplace and scaled back its Web3 offerings.

By April 10, Bybit had regained its pre-hack crypto market share of nearly 7%. The company also allocated over $2 million in bounties for tips that assisted in tracing and freezing approximately 89% of the stolen funds by the end of March.

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Crypto Trading Volumes Decline in Q1 2025 as Market Energy Wanes

Significantly, crypto trading activity experienced a notable decrease in Q1 2025, with spot trading volumes on the leading 10 centralized exchanges dropping to $5.4 trillion — a 16.3% decline compared to the previous quarter, as reported by CoinGecko.

Binance retained its top position with a 40.7% market share despite a significant drop month-over-month, while Bybit faced the steepest decline, plummeting over 52% following the major breach. HTX was the only leading exchange to report quarterly growth.

The broader trading market exhibited similar weaknesses, with the total crypto asset market capitalization diminishing by 18.6% to $2.8 trillion. Daily trading volumes contracted by 27.3%, and although BTC reached a peak in January, it closed the quarter down 11.8%.

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