Bybit’s $1.5 billion stolen: Why the hack proves Ethereum’s value

Source: TEDAO

Bybit suffered a theft of ETH worth $1.5 billion, and some people called on Ethereum to roll back the blockchain to undo the hack. This incident has become an excellent educational case, explaining why public chains are immutable ledgers. The essence of this incident is not a vulnerability in Ethereum, but its core feature - even if one of the largest thefts in human history occurs, it will not be artificially reversed.

Why?

Because the irreversibility of blockchain transactions is one of the most powerful trust mechanisms in the world today.

This property ensures the scarcity of native assets issued on Ethereum (such as ETH), as well as the predictability of smart contracts that support key financial activities such as DeFi.

Scarcity and predictabilityare the cornerstones for building a more resilient, globalized digital economy. We understand their importance because they have also been the foundation of the real economy for thousands of years. Without scarcity, there would be no “naturally valuable assets” like gold, but only “value carriers that rely on human trust” like fiat currency. Fiat currency certainly has its advantages, but almost all fiat currencies that have ever existed have eventually become worthless, while gold has reached new highs. Gold follows natural laws, while fiat currency follows artificial rules. Natural laws are more constant and reliable.

Nature's laws are also more predictable.It may sound exaggerated, but one of the greatest features of nature is thatthe laws of physics and chemistry do not change.Hydrogen and oxygen combine to form water, and the acceleration due to gravity at the surface of the Earth is 9.8 m/s².Withoutthispredictability, there would be no skyscrapers, airplanes, or iPhones, nor would there behighly developed civilizations and economies.

Today, the economy is accelerating digitalization. But the digital world faces the problem of scarcity and predictability. Data is not inherently scarce and can be easily copied, tampered with, deleted, or manipulated . This mutability does bring convenience—credit card payments are more convenient than cash, and Google Docs is more user-friendly than typewriters. Butfrom a trust-building perspective, this is a huge problem.Credit card payments can be frozen or revoked at will,and digital documents (such as important news headlines) can be altered, forged or deleted.

So, how to solve this problem?

One ​​way is to leave the digital economy to big corporations and governments and hope that they will do the right thing—hope that governments don’t print too much money, even though there is almost no cost to doing so in the digital age; and hope that companies don’t discriminate against certain users, censor payments (or news) that don’t serve their interests, or charge high fees, even though these actions are both simple and credible. leaf="">profitable.

Another wayis to invent a technology that gives digital assets (whether monetary units or information) properties of the physical world, such as scarcity, censorship resistance, and predictability. This is exactly whatBitcoin has achieved. The fact that Bitcoin is now a $2 trillion asset and is gaining

Other blockchains, like Ethereum, extend this capability to a wider range of asset classes and use cases. Native cryptocurrencies like ETH, and smart contracts like Aave, provide an unprecedented level of predictability—one that is unavailable elsewhere in the global economy.

The more predictable financial infrastructure is, the more types of economic activity it can support. You wouldn’t choose a payment method that you could revoke at will to complete a multi-billion dollar transaction, just as you wouldn’t build a skyscraper on a planet with unstable gravity.

Key Point: Scarcity and Predictability Do Have Their Downsides

They Can Cause Bad Things to Happen to Good People, and There’s Nothing That Can Be Done About It . Gold can be lost or stolen - in fact, some of the gold ever mined in human history is on the ocean floor, and people are experiencing losses of stolen jewelry right now. The same applies to other recognized stores of value, such as art. But no one ever says:

"The fact that stolen gold cannot be recovered by just making a phone call is a fatal flaw."

"We shouldn't consider Michelangelo's works valuable because they are easily damaged."

No one says these things because

it's complete nonsense. Goldis irreplaceableand artworksare fragile, which is precisely why they are valuable. We accept their imperfections becausethose flaws are the premise of value.

However, now some smart people, including experts in the crypto industry, are saying similar things about the stolen ETH. They believe that Ethereum should roll back the blockchain and undo the losses caused by the hack because the victims are innocent and the hackers (most likely North Korea) are profiting from it. They also argue:

“If public chains don’t have a ‘revoke’ button, they will never be widely adopted.”

The fundamental problem with these views is thatthey still see blockchain as an evolved version of the credit card network.

They should change their way of thinking and stop thinking of blockchain as an upgraded version of the credit card networks. Instead, they should see it as an evolution of the physical world - one that combines the best of the natural world (scarcity, predictability) with the best of human intelligence (programmability, innovation).

Ethereum should not roll back the blockchain.

On the contrary, the occurrence of this hacker attack, and the fact that the underlying infrastructure will not make any changes to it, is the most powerful propaganda for the value of blockchain - it shows that more human activities should be migrated to the chain in the future.

Irreversibility ≠ Lack of flexibility

Although Ethereum itself should maintainthe greatest degree of irreversibility,,,,,,,

Irreversibility ≠ Lack of flexibility

Although Ethereum itself should maintainthe greatest degree of irreversibility, ...

Butthis “undo button” is only valuable if the underlying network is as predictable as gravity.