Eugene (L) and Ginger Arboleda giving a demonstration on how to play Axie Infinity, an NFT game where players earn tokens that can be exchanged for cryptocurrency or cash, Manilla, December 10, 2021.
Jam Sta Rosa | AFP | Getty Images
The popular blockchain game Axie Infinity, which lets users earn money as they play, is connected to what could be the largest decentralized finance, or DeFi, hack in history.
Axie Infinity’s Ronin Network said in a blog post on Tuesday that it lost around $615 million in USDC (a U.S. dollar pegged stablecoin) and ethereum, surpassing the $611 million hack of the DeFi protocol Poly Network in August 2021.
The security breach was confirmed by Axie Infinity’s official Discord and Twitter accounts, as well by Ronin Networks. DeFi networks aim to recreate traditional financial systems like banks, but with cryptocurrency mostly run on the ethereum blockchain.
The exploit was discovered Tuesday after a user was unable to withdraw 5,000 ether. But the attack took place on Mar. 23, when exploiters used hacked private keys to forge fake withdrawals, the blog post said, adding that other key validator nodes were compromised.
Ronin said the breach resulted in 173,600 ethereum and 25.5M USDC being drained from the Ronin bridge in two transactions, which can be viewed on Etherscan. The project lost around $615 million at current prices.
Axie Infinity is a blockchain-based game that lets users collect and breed digital creatures called “Axies.” In contrast to traditional pay-to-play games, Axie Infinity also allows players to earn money by selling their Axie non-fungible tokens, or NFTs, to other users.
Axie Infinity creator Sky Mavis said it’s committed to ensuring that all of the drained funds are recovered or reimbursed. For now, users are unable to withdraw or deposit funds.
Ronin said it’s “working with law enforcement officials, forensic cryptographers, and our investors to make sure there is no loss of user funds.”
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