$625M Ronin crypto heist: What to know

CoinDesk exec on ‘one of the biggest hacks in crypto histroy’

Pete Pachal, CoinDesk’s chief of staff for the content team, argues the gaming-focused Ronin Network’s announcement of a security breach shows that ‘things start to get a little dicey’ when moving further away from core crypto products.

Hackers have stolen over $625 million in Ethereum and USD Coin from the Ronin blockchain network in what is being referred to as one of the largest cryptocurrency heists in history. 

FOX Business provides a roundup of everything you need to know about the hack.

RONIN HIT BY $615M CRYPTO HEIST

What is Ronin?

Ronin is a blockchain project used by the popular, non-fungible token (NFT)-based online game Axie Infinity, developed by publisher Sky Mavis. The Ronin network allows players to store cryptocurrency in a digital wallet and transfer it in and out of the game using what is known as a "bridge".  

Axie Infinity, which has 2.8 million daily active players, allows users to earn money by collecting, trading and playing with virtual creatures called Axies. Players have traded approximately $3.6 billion on its in-house marketplace prior to the hack.

Axie Infinity, which has 2.8 million daily active players, allows users to earn money by collecting, trading and playing with virtual creatures called Axies. Players have traded approximately $3.6 billion on its in-house marketplace prior to the hack (Axie Infinity / Fox News)

Axie Infinity is the biggest NFT collection by all-time sales volume, according to NFT market tracker CryptoSlam. Sky Mavis raised $152 million in October from a group of investors, including Andreessen Horowitz.

How did the hack happen?

The Ronin team said in a blog post that the breach was discovered on Tuesday morning following a report that one of its users was unable to withdraw 5,000 Ethereum from its bridge.

Hackers were able to gain access to five private keys used to validate transactions in order to forge fake withdrawals on March 23, resulting in 173,600 Ethereum and 25.5M USDC drained from the Ronin bridge in two transactions. The identity of the hackers remains unknown.

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What actions have been taken to protect Ronin’s users? 

In an update on Wednesday, Axie Infinity co-founder Aleksander Larsen said its internal network is "going through a deep forensics review to ensure there is no lingering threat." According to Larsen, the hack stemmed from a "social engineering attack combined with human error from December 2020." 

The Ronin Network is currently working with law enforcement officials, forensic cryptographers, and investors to make sure there is no loss of user funds and various government agencies to ensure the criminals get brought to justice.

"We are committed to ensuring that all of the drained funds are recovered or reimbursed, and we are continuing conversations with our stakeholders to determine the best course of action," Larsen added. 

Where are the stolen funds now? 

According to the Ronin Network, the majority of the stolen funds remain in the hacker's wallet. Meanwhile, analysts at Blockchain Intelligence Group have said that some of the funds have been moved major exchanges, including FTX, Crypto.com and Huobi.

"Huobi will fully support Huobi @AxieInfinity as it deals with the aftermath of the attack and theft on its Ronin chain," the platform tweeted. "Any stolen crypto assets that have been discovered to have traversed our exchange and related networks will be dealt with expediently."

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