Bybit restructures executive team following $26M airdrop fiasco

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Several executives from the crypto exchange Bybit had changed positions after a flawed airdrop resulted in over $26 million in compensation to users. 

Reports of leadership changes in the exchange first surfaced on May 31. A Bybit spokesperson told Cointelegraph the company updates its business structure “regularly”:

“Together with the team, we made a joint commitment to placing the right people in the right roles. […] This improvement led to some leadership role changes, which we believe are essential. […] The affected team members are not leaving the company but moved to take up other internal roles.”

The changes follow the botched airdrop of Notcoin (NOT), a play-to-earn game and token integrated as a Telegram Mini App. In a statement, Bybit explained that the airdrop was delayed due to system maintenance and an unusually high transaction volume:

“Airdrops were distributed to users whose transactions occurred during the scheduled system maintenance. Hence, it took longer to reconcile all balances and reflect them accurately.”

The delayed distribution of tokens led to a lower trading price for those who received their tokens later. The balance issue affected 320,000 users, according to the exchange. In response to the incident, Bybit disclosed a $26 million compensation plan on May 17.

“Total around $26M compensation will be processed within 3 working days, emails will be sent to you. Again, sorry for the problem caused, we will do deep dive internally to make sure it never happens again,” wrote Bybit’s CEO Ben Zhou.

Source: Ben Zhou

The exchange is having a challenging month. On May 22, Zhou dispelled rumors on X that Bybit was insolvent or hacked. The rumors were largely based on a misinterpreted chart suggesting funds were being drained from the exchange’s wallets.

In response, Bybit shared its proof of reserves and data from a Nansen dashboard showing it holds more than 100% of all assets required to cover all deposits.

A few days before, on May 16, Bybit faced regulatory challenges in France. The Autorité des Marchés Financiers (AMF) reiterated a warning that the exchange is blacklisted in the country.

Magazine: Bybit’s Notcoin listing debacle, China firm’s profits up 12-fold after crypto buy: Asia Express