Popular NFT gaming platform Axie Infinity’s Ronin Network compromised for $600M. The official announcement for the security breach was made on Ronin’s Twitter handle while a community alert was generated through the Ronin blog post yesterday. This is also considered the largest hack in the crypto world so far.
According to Axie Infinity’s official sources, Discord and Ronin Network along with Katana Dex have been halted. Currently, the platform underwent a total estimate suffering of 173,000 Ethereum (ETH) and 25.5 million USD Coin (USDC). Both the assets hold worth $612 million at Tuesday’s prices.
Moreover, Ronin discovered the security breach on March 23rd, where Sky Mavis’s Ronin validator nodes and Axie DAO validator nodes suffered a heavy loss of 173k ETH and 25.5 million USDC in two transactions.
The Ethereum address used for attacking is a fresh address where ETH was transferred a week ago through the Binance exchange. While still, a large portion of the funds remain in the attacker’s address, 6,250 ETH have been transferred to other variable addresses according to Etherescan records.
Besides, Ronin got to know about the attack when a user complained about an involuntary withdrawal of 5k ETH from his account where the attacker used a private key to forge the withdrawal.
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Actions are taken by the Board
- On the other hand, The Axie Infinity’s developers are working with law enforcement officials, forensic cryptographers, and their investors for full recovery of the funds.
- To prevent future short-term damage to the resources, the validator threshold has been increased from five to eight.
- Major crypto exchange platforms are been in contact to address the immediate credit of funds in newly generated addresses.
- Complete migration of nodes from old infra to newly developed structures is expected from the gaming platform.
- Currently, the Ronin Bridge is not in working condition to battle against future attacks. Even Binance has also disabled the Ronin Bridge from their platform. However, the network does not wish to operate in the near time and no announcement is done to continue the bridge. The organization is making sure that no further assets are draining out of the network.
- Similarly, Katana DEX also has been disabled due to the inability to deposit more funds on the Ronin Bridge.
- Ronin Bridge is working in association with ‘Chainalysis’ to monitor the ‘stolen funds’ as soon as possible.
Furthermore, many users on Axie Infinity suspect that the drifted funds have landed on the FTX Trading exchange. However, only speculations are been made while no proof or official statement has been generated by Ronin.
How did the attack take place?
While ‘Ronin’ is sorry about the attack, a gush of thoughts are now wandering into their minds about prioritizing security, remaining vigilant, and mitigating all threats. Meanwhile, the network is under the thorough process of investigation for the security breach.
According to the community blog post, five validator private keys were compromised including 4 Sky Mavis and 1 Axie DAO. It is presumed that the attacker might have forged one of the validator’s private keys through a gas-free RPC node while the Axie DAO validator IP is still on the allowlist.
The attacker got access to Sky Mavis systems and was able to get the signature from the Axie DAO validator using the gas-free RPC.
Significant matches of the signature have been reported by the Ronin Bridge where about five validators are to be suspected.