Following the Bybit hack, community members have discussed the possibility of “rolling back” the Ethereum network to recover stolen funds. Several experts, including core developer Tim Beiko, have criticized the idea.
Support for blockchain restoration came from figures such as Bitcoin maximalist Samson Mow and BitMEX co-founder Arthur Hayes.
ELI5 why we cannot “rollback” Ethereum?
After yesterday’s Bybit hack, crypto commentators are again asking why Ethereum cannot “rollback” the chain to reverse the hack.
While experienced ecosystem actors near-unanimously agree that this is infeasible, it’s worth breaking down…
— timbeiko.eth (@TimBeiko) February 22, 2025
Beiko emphasized that in the Bybit incident, there were no technical issues with the Ethereum protocol or the multisig application used by the exchange’s employees. The problem lay in the misrepresentation of transaction data in the compromised interface.
In the case of Bitcoin’s “rollback” in 2010—one of the instances of forcibly reverting the network to a previous state—a bug in the client software led to the erroneous mining of 184 billion BTC. Satoshi Nakamoto released a patch that invalidated these transactions. Within a day, the updated “restored” chain became the main one.
Beiko noted that at that time, there was an obvious bug in the protocol, problematic transactions were easily identified by their anomalous volume, and Bitcoin’s limited distribution allowed for a swift deployment of the update.
The programmer’s second argument against an Ethereum “rollback” was that in the Bybit hack, the attacker could have immediately used the funds. As a counterexample, he cited the 2016 incident with The DAO.
The organization lost $60 million in ETH at the time due to a vulnerability in the application. However, the system had a security measure—outgoing transactions were frozen for a month. This gave the team the opportunity to prevent the withdrawal of funds.
To recover the assets, Ethereum developers directly altered the blockchain data, creating a network fork. Part of the community disagreed with such measures and continued using the original chain, which became Ethereum Classic.
After the Bybit hack, the funds quickly dispersed through the complex ecosystem of the second-largest cryptocurrency by market capitalization. A network “rollback” would entail canceling numerous legitimate operations, some of which are linked to actions outside the Ethereum network. Moreover, the off-chain component of these transactions would remain unaffected, Beiko added.
Yuga Labs Vice President, known as Quit, emphasized that the damage from reversing part of the blockchain’s history would exceed the amount of stolen funds. He noted that many ordinary users would lose money, and accounting systems of major players like Circle and Tether would collapse.
Ethereum could rollback, yes (so could bitcoin btw, all you need is majority consensus).
The impact of doing so would be larger than $1.5B. Thousands of innocent people would lose money, thousands more would gain money they shouldn’t Accounting for all major players like Circle…
— Quit (@0xQuit) February 22, 2025
“It might be cheaper to just send a strike team to North Korea to try to recover the funds. Or ask very politely, I don’t even know,” wrote Quit.
Earlier, on February 19, part of the funds stolen in the January hack of the Singapore-based cryptocurrency exchange Phemex began to move.