The $1.4 billion Ethereum ETH/USD theft from cryptocurrency exchange Bybit has not only sent shockwaves through the market but also revived a long-standing contentious debate—implementing a hard fork to recover hacked funds.

The enormity of the hack, considered the biggest in cryptocurrency history, and the involvement of North Korea's state-backed Lazarus Group have motivated these demands.

Blockchain technologist Samson Mow argued that rolling back the Ethereum chain would hinder Kim Jong Un-ruled North Korea from using the funds to fund its nuclear weapons program.

However, several analysts that Benzinga spoke to said such a move would be detrimental to the network and the broader cryptocurrency industry.

‘Hard Fork Could Trigger Exodus of Applications To Other Chains’

Kadan Stadelmann, blockchain developer and Chief Technology Officer of Komodo Platform, said that any rollback would end up causing "extensive ripple effects" for any individuals or companies using ETH as settlement

"In addition, it would be a big shock across the Dapp layer, potentially causing an exodus to other blockchains as developers lose confidence in the immutability of the Ethereum blockchain," Stadelmann emphasized. 

A hard fork splits the blockchain into two separate versions, typically initiated after a significant security violation. 

The most notable case was the $50 million Decentralized Autonomous Organization hack in 2016, which resulted in the creation of the new Ethereum blockchain as we know it today and the unaltered network known as Ethereum Classic ETC/USD. The move helped confiscate the stolen funds and placed them in a new program.

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The Difference Between DAO 2016 And Bybit 2025

"Ethereum is now roughly 300 times larger than it was in 2016—if the entire network forked around one hack, it would risk confidence and trust in the platform at large,” said Austin King, former Ripple XRP/USD executive and CEO of Omni Labs.

Amir Forouzani, co-founder of Ethereum-based Puffer Labs, reiterated this sentiment, stating that many more decentralized exchanges, lending protocols, and stablecoins have been built atop Ethereum since the 2016 hack, and a hard fork would "heavily disrupt" these.

Indeed, Ethereum had a total value locked worth nearly $50 billion, according to DeFiLlama, making it the world's most valuable blockchain at the time of writing. 

Forouzani also highlighted the scale difference between the two hacks. While the 2016 event led to the theft of nearly 5% of ETH's supply, the Bybit hack affected only 0.33% of the total supply. He said that had the hack been larger, different considerations might have come into play.

The Debate Around Immutability

One of the influential proponents of the idea of the rollback is Arthur Hayes, co-founder of cryptocurrency exchange BitMEX and Chief Investment Officer at Maelstrom Fund.

"My own view as a mega ETH bag holder is ETH stopped being money in 2016 after the DAO hack hardfork. If the community wanted to do it again, I would support it because we already voted no on immutability in 2016, [why] not do it again?"

However, Trever Koverko, Web3 investor and co-founder of Sapien, believed that immutability is a core principle of Ethereum, and reversing transactions will undermine trust and decentralization. 

"Instead of rewriting history, the focus should be on stronger security practices and on-chain insurance solutions," Koverko suggested.

Price Action: At the time of writing, Ethereum was exchanging hands at $$2,111.37, down 9.74% in the last 24 hours, according to data from Benzinga Pro. 

Image via Shutterstock

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