A security research team at the major crypto exchange Bybit has identified 16 blockchain networks that are technically capable of freezing or restricting user funds.

Bybit’s Lazarus Security Lab on Tuesday

Unlike regular user accounts, module accounts are controlled by module logic rather than private keys, potentially allowing for the restriction of transactions.

“This function could, in theory, be modified in the future to add a hacker’s address, but so far none of the blockchains in the Cosmos ecosystem have used it in this way,” the report stated, adding:

“Implementing such a change would require a hard fork along with minor adjustments — likely in the anteHandler file — or additional code modifications.”

Bybit’s researchers warned that the presence of these mechanisms, even when intended to prevent theft or hacks, raises deeper concerns about censorship and centralized control in blockchain systems.

Related: Bybit hack: ‘Reckoning’ that led SafeWallet to rearchitect its systems

The findings add to the growing debate about whether “decentralized” networks remain so in practice, as more projects integrate emergency controls, compliance modules, and admin-level privileges that blur the line between security and centralization.

The report came months after Bybit suffered a $1.5 billion cold wallet hack, one of the largest security incidents the crypto industry has ever seen. With coordinated efforts of partners like Circle, Tether, THORchain and Bitget, the community managed to freeze $42.9 million of exploited funds, while mETH Protocol even recovered cmETH tokens worth nearly $43 million.

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