Key Notes
- Bybit will explore segregated crypto holdings for users with Zodia Custody.
- The deal will see users’ funds kept on Zodia while being able to trade on Bybit.
- Crypto exchanges are innovating and boosting security measures to prevent exploits.
Bybit Fintech Limited has disclosed that it is ramping up its security after suffering a $1.45 billion hack in February 2025.
The leading cryptocurrency exchange has partnered with Zodia Custody, a firm backed by major financial institutions, to provide its clients with a safer way to store their digital assets.
Bybit and Zodia Custody to Strengthening Security
The February hack on Bybit was one of the largest in crypto history, with nearly $1.5 billion worth of Ethereum stolen.
The FBI confirmed that the attack was carried out by the North Korean Lazarus Group, exposing significant security weaknesses in cryptocurrency exchanges.
Several issues of concern were raised among investors, particularly corporations seeking opportunities for a secure way to trade and invest in digital assets. In response, Bybit will now offer a custody solution following its newly announced collaboration with Zodia Custody.
As revealed by the firm, this service grants institutional clients access to trade on Bybit while keeping their assets stored separately with Zodia. This setup was designed to prevent losses from potential future breaches. It also reduces the risks associated with keeping funds directly on an exchange.
Financial giants like Northern Trust SBI Holdings Standard Chartered back Zodia Custody. Unlike traditional exchange wallets that often mix customer funds, Zodia makes sure that assets remain segregated. This approach makes it harder for hackers to access customer funds and minimizes the risks of mismanagement or insolvency.
Another important benefit of the recent update is the off-venue settlement. This implies that traders and investors do not have to pre-fund their Bybit trading accounts. Instead, their funds remain in custody until a trade is executed. This avenue cuts down exposure to exchange-related risks and improves capital efficiency.
A New Standard for Institutional Crypto Trading
It is worth noting that Bybit’s partnership with Zodia Custody represents a major departure in how digital asset exchanges manage security. This is because institutional service providers now have a custodial solution that resembles traditional finance. The goal is to provide a higher level of safety and regulatory compliance.
Zodia Custody operates under strict security measures, including SOC-certified infrastructure, which meets the standards of major financial institutions.
Many experts believe this gives institutions greater confidence in investing and trading in the crypto market without worrying about exchange-related vulnerabilities.
Bybit’s partnership with Zodia Custody also points to a broader trend of crypto exchanges adopting stricter security measures to attract institutional investors. Even though many experts have reservations about corporate adoption compromising the decentralized nature of crypto, others consider them a good step in the right direction.
In light of continued cybersecurity threats and crypto scams, experts believe crypto exchanges must continue to strengthen their security measures. Bybit proponents support the company’s integration of Zodia’s custody services.
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Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.
