Bitcoin, Ethereum, and Dogecoin saw a sharp drop on Friday after a security breach at crypto exchange Bybit, which reportedly saw $1.4 billion in crypto outflows.

Bitcoin briefly challenged the $100,000 mark before slipping back near $97,000, while Ethereum fell nearly 4% below $2,700. Dogecoin dropped 3% and other altcoins also dropped amid concerns over exchange security.

Bybit CEO Ben Zhou confirmed the incident, stating that the exchange’s ETH cold wallet was compromised due to a sophisticated attack that manipulated the multisig signing interface.

“Bybit ETH multisig cold wallet just made a transfer to our warm wallet about 1 hr ago. It appears that this specific transaction was musked, all the signers saw the musked UI which showed the correct address and the URL was from Safe. However, the signing message was to change the smart contract logic of our ETH cold wallet,” Zhou wrote on X.

He further explained, “This resulted [in the] hacker [taking] control of the specific ETH cold wallet we signed and transferred all ETH in the cold wallet to this unidentified address.”

Zhou added that Bybit is solvent and “even if this hack loss is not recovered, all of the client assets are 1 to 1 backed.”

On-chain intelligence firm Arkham flagged over $1.4 billion in ETH and stETH outflows from Bybit.

Bybit has not officially disclosed the exact amount lost in the hack.

Bybit noted that the incident was isolated to a single ETH cold wallet, assuring users that hot wallets, warm wallets, and all other cold wallets remain secure.

“Please rest assured that all other cold wallets are secure. All withdrawals are normal,” Zhou stated.

The exchange is currently working with blockchain forensic experts to track the stolen funds and has called on teams with expertise in fund recovery to assist.