Crypto Exchange eXch Set to Close Following Accusations Linked to Bybit Hack

The digital currency protocol eXch has declared that it will officially halt its activities on May 1, following accusations that the service was implicated in laundering funds associated with the notorious Bybit breach.

This announcement was made public in a statement released on April 17, where the exchange highlighted rising pressure from regulatory bodies and a shared agreement among its leadership to leave the market.

The issue revolves around allegations that North Korea’s Lazarus Group laundered nearly $35 million through eXch, part of the estimated $1.4 billion stolen in a significant hack aimed at Bybit earlier this year.

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eXch Claims to be the Target of a Transatlantic Operation Amid Legal Risks

eXch asserted that it has become the center of an “active transatlantic operation” aimed at dismantling its framework and possibly levying legal actions against its operators.

After initial denials, eXch later conceded to processing a minor amount of the hacked funds. The company asserted that these transactions were “minimal” and insisted it had not knowingly endorsed illegal actions.

In its closure notice, eXch condemned what it referred to as “an aggressive atmosphere” fueled by misunderstanding of its privacy-centric operations. The exchange claimed that ongoing surveillance, including signals intelligence (SIGINT), had rendered continued operations impractical.

“Despite our barrier level to multiple shutdown attempts, we see no benefit in staying operational under perpetual threat,” the firm stated.

The management underscored its dedication to user privacy, criticizing rival exchanges for adopting what it labeled “illogical policies” masquerading as anti-money laundering efforts.

eXch has announced that they will cease all operations May 1st 2025.

If you recall, during the ByBit breach, the Lazarus group utilized eXch to launder hundreds of thousands of dollars of stolen Ethereum. pic.twitter.com/dIXHhaZmUA

— vxdb (@vxdb) April 17, 2025

The repercussions of the Bybit breach, one of the largest in the crypto realm, have been considerable. Following the breach, over $5 billion in user withdrawals occurred.

Initially, Bybit CEO Ben Zhou assured users that the company could handle the losses, but the exchange later shut down its DIGITAL COLLECTIBLE marketplace and scaled back its Web3 offerings.

By April 10, Bybit had returned to its pre-breach market share of around 7%. The platform also distributed over $2 million in bounties for information that assisted in tracing and freezing roughly 89% of the stolen funds by late March.

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Crypto Trading Volumes Decline in Q1 2025 as Trading market Activity Slows

Importantly, crypto trading activities saw a marked decline in the first quarter of 2025, with spot trading volumes on the largest 10 centralized exchanges dropping to $5.4 trillion — a decrease of 16.3% compared to the previous quarter, as reported by CoinGecko.

Binance maintained its dominance with a 40.7% trading market share, despite a significant monthly drop, while Bybit experienced the steepest decline, down over 52% after the major breach. HTX was the only leading trading network to report quarterly growth.

The overall crypto market exhibited similar weakness, with total market capitalization decreasing by 18.6% to $2.8 trillion. Daily trading volumes fell by 27.3%, and BTC, despite achieving a database high in January, concluded the quarter down 11.8%.

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