Bitcoin Slips as Investors Weigh Fed Policy and Bybit Hack Fallout

Bitcoin extended its decline on Monday, following a 1% drop last week, as investors exercised caution amid U.S. interest rate uncertainty and concerns over a major security breach at Bybit.

Key Market Moves

• Bitcoin dropped 0.8% to $95,610.2 (as of 6:22 GMT), pressured by Fed rate policy uncertainty and negative sentiment from the Bybit hack.
• Weak U.S. economic data has further fueled market caution.

Bybit Suffers $1.5 Billion Loss in Massive Crypto Heist

• The hack occurred during a transfer from an offline “cold” wallet to an online “hot” wallet, leading to the theft of 401,000 Ethereum—one of the largest digital heists in history.
• Bybit CEO Ben Zhou reassured users that the exchange remains solvent and has sufficient reserves to cover losses.
• The exchange has launched an investigation with blockchain forensic experts and is offering a 10% bounty for information leading to fund recovery.
• Over 350,000 withdrawal requests have been processed post-incident, causing potential delays.
• Preliminary reports suggest the attack may be linked to North Korean hacking group Lazarus.

Investor Caution Amid Fed Rate Uncertainty

• Weak economic data adds to investor concerns:
  • U.S. Services PMI fell to 49.7 in February from 52.9 in January, indicating a contraction.
  • Michigan’s consumer sentiment index dropped to a 15-month low of 64.7, down from 71.7 in January.
• Fed maintains a hawkish stance, emphasizing inflation risks due to:
  • Sticky core inflation
  • Tariff concerns
  • Government spending cuts
• Market volatility remains high, with Bitcoin reacting to the Fed’s tightening bias and macroeconomic headwinds.

Outlook: Bitcoin’s near-term trajectory will be shaped by further Fed policy signals, economic data, and investor confidence in crypto security measures following the Bybit breach.