1. The DAO incident and hard fork
Background: In 2016, a decentralized autonomous organization (DAO) smart contract on Ethereum was attacked by hackers using a vulnerability, stealing about 3.6 million ETH (about 5% of the total supply at the time, worth about $50 million). This triggered a heated debate in the community: whether the loss should be recovered by modifying the blockchain state.
• Solution: The Ethereum community eventually passed a hard fork, splitting the chain into two at block height 1,920,000. The new chain (now the Ethereum mainnet) transferred the funds stolen by the hacker to a "recovery contract" and returned them to the affected users; the old chain retained its original state and continued to run, called Ethereum Classic (ETC).
• Is it a rollback? Strictly speaking, this is not a rollback, but a new chain created through a hard fork, which changes the result of the transaction history. A rollback means that the entire network unanimously agrees to revoke certain blocks and return to the past state. In the DAO incident, the community chose to split the blockchain, and the old chain (ETC) still retained the original record of the hacker attack.
• No precedent for rollback due to hacking incidents: In addition to the DAO incident, which was handled through a hard fork, Ethereum has never performed similar operations due to other hacker attacks (such as the Parity multi-signature wallet vulnerability in 2017, which lost 150,000 ETH). The community generally believes that hard fork intervention should be avoided as much as possible to maintain decentralization and immutability.
Bybit theft and rollback possibility
The theft of 500,000 ETH from Bybit (February 2025) occurred off-chain (exchange wallets) rather than due to a vulnerability in the Ethereum blockchain itself. Therefore, even if the community or developers intervene intentionally, these funds cannot be recovered by rolling back the Ethereum mainnet, because these ETH have been transferred to addresses controlled by hackers and the transaction records have been confirmed on-chain.