EU Regulators Investigate OKX Over Alleged Role In Bybit Hack Money Laundering

European Union regulators are reportedly scrutinizing a service offered by crypto exchange OKX that may have facilitated the laundering of $100 million linked to the Bybit hack, according to Bloomberg.

A 11 March 2025 report, citing sources familiar with the matter, claims that regulators from various EU member states discussed the issue during a March 6 meeting of the European Securities and Markets Authority’s (ESMA) Digital Finance Standing Committee.

The focus of the inquiry appears to be OKX’s decentralized finance (DeFi) platform and its wallet service.

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OKX Secures Full MiCA Approval to Operate Across EU

OKX, one of the world’s largest cryptocurrency exchanges, announced on Jan. 27 that it had secured full approval under the Markets in Crypto-Assets (MiCA) regulatory framework, allowing it to operate across all EU member states.

However, regulators are now assessing whether OKX’s Web3 services fall under MiCA’s jurisdiction and whether the exchange could face penalties if found in violation.

Bybit CEO Ben Zhou has alleged that approximately $100 million—equivalent to 40,233 Ether (ETH)—from the massive $1.5 billion hack was funneled through OKX’s Web3 proxy, making a portion of the stolen funds untraceable.

OKX’s wallet service, which supports 53 million addresses across 100 blockchains, is at the center of the controversy. While decentralized platforms may be exempt from MiCA oversight, regulators from Austria and Croatia reportedly argue that OKX’s Web3 service should be subject to EU rules.

OKX has denied any wrongdoing and dismissed claims of an ongoing EU investigation. In a statement on X, the company accused Bybit of spreading misinformation and defended the integrity of its Web3 wallet services.

The Bloomberg article is misleading. Like all other major crypto exchanges, OKX provides a self-custody wallet service/swap feature that serves as an aggregator to create efficiency for the users. When Bybit got hacked, we reacted in two ways. (1) We froze associated funds moving… https://t.co/HUUmA8W2eq

— OKX (@okx) March 11, 2025

Haider Rafique, OKX Global’s chief marketing officer, reinforced this stance, calling the allegations “preposterous” and denying any involvement in laundering stolen funds.

The Bybit hack, which resulted in the theft of $1.5 billion in ETH and related tokens, is considered the largest crypto hack to date. Crypto investigators have attributed the attack to the Lazarus Group, a North Korean hacking syndicate.

Zhou, who has vowed to take action against the group, revealed that while 3% of the stolen funds have been frozen, 20% have become untraceable.

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North Korean Hackers Already Laundered $300M

North Korean hackers have successfully laundered at least $300 million from their record-breaking $1.5 billion cryptocurrency heist, making it nearly impossible to recover.

Analysis from Bybit and Elliptic suggests that 20% of the stolen funds have already “gone dark,” meaning they are unlikely to ever be recovered.

3.4.25 Executive Summary on Hacked Funds:
Total hacked funds of USD 1.4bn around 500k ETH, 77% are still traceable, 20% has gone dark, 3% have been frozen.
Breakdown:
– 83% (417,348 ETH, ~$1B) have been converted into BTC with 6,954 wallets (Average 1.71 btc each) . This and…

— Ben Zhou (@benbybit) March 4, 2025

To combat the hackers, Bybit has launched the Lazarus Bounty Program, offering rewards for anyone who helps track and freeze stolen assets.

So far, 20 individuals have received over $4 million in rewards for helping identify $40 million of the stolen funds, leading to their freezing.

However, experts warn that recovering the remaining assets remains a major challenge, given North Korea’s expertise in hacking and money laundering.

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