Axie Infinity dev raises $150 million to recover from crypto’s greatest heist

In an attempt to cushion the effects of one of the biggest cryptocurrency heists in the world, non-fungible token (NFT) game Axie Infinity developer Sky Mavis has successfully raised millions of funds to be reimbursed to affected crypto investors.

Led by one of the world’s most popular crypto exchanges Binance, over 150 million US dollars in investments were raised and will be used for the reimbursement of all balances stolen by the hackers. 

We are pleased to reveal that we have raised a $150 million funding round led by the world’s largest crypto exchange Binance,” Sky Mavis said in their Substack statement released on Wednesday. “The round will be used to reimburse user funds affected by the Ronin Validator Hack.” 

Just last week, the Vietnam-based developer suffered a major setback after losing a huge amount of blockchain assets to hackers. Roughly $600 million worth of cryptocurrency, mainly decentralized coins Ethereum and USDC, were hacked out of the Axie Infinity developer’s Ronin Network sidechain. (Read: Cryptocurrency businesses must now conduct background checks, says BSP)

According to Sky Mavis, the attack happened when the hacker successfully broke into their private security keys, compromising the network nodes in charge of transfers to and from the Ronin blockchain. The heist was discovered on March 23 after a user was unable to withdraw 5,000 Ethereum from the bridge. 

“The attacker used hacked private keys to forge fake withdrawals,” said in the Substack. “The attacker found a backdoor through our gas-free RPC (Remote Procedure Call) node, which they abused to get the signature for the Axie DAO (Decentralized Autonomous Organization) validator,” they said in a detailed enumeration of the event. 

The Ronin Network bridge was immediately frozen afterward to prevent further crime, while most of the hacked assets are still confined in the hacker’s wallet.

Joining Binance in the fundraiser are venture capital company Animoca Brands and a16z; investment firm Paradigm; Dialectic; and Accel. Although the amount raised was low compared to the amount lost, the fundraiser comes at a fitting time for Sky Mavis as they have also launched the much-anticipated Origin gameplay of Axie Infinity. 

Origin, which displays brand new gameplay and new cards for the game, has been on the radar of Axie users as early as last year. The standalone web game is now available on Mavis Hub, Sky Mavis’ distribution platform, on early access, and is free to play. 

Further news about the heist is yet to be released in Sky Mavis’ community newsletter, but the company assured us that they are doing everything they can and such incidents will remain an issue of the past. 

“We are in the process of discussing with Axie Infinity / Sky Mavis stakeholders about how to best move forward and ensure no users’ funds are lost. Sky Mavis is here for the long term and will continue to build.”

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