Hacker steals over $620 Million from Axie Infinity’s Ronin sidechain

Sidechain Ethereum (ETH) Ronin announced a break on March 23, 2022, and a loss of $ 550 million. The theft at the time of the incident was more than 173,600 ETH and $ 25,5 million removed from the Ronin Bridge. Thus, this hack becomes the second largest in the history of cryptocurrencies. We remind you that the biggest such hacking theft is the hacking of the Poly Network worth more than 610 million in cryptocurrencies.

The second biggest sidechain hack

A hacker broke on March 23, 2022, stole 173,600 ETH and $ 25.5 million from the Ethereum (ETH) Ronin sidechain dedicated to the Axie Infinity blockchain game (AXS). In total, this is $ 552 million, making this theft the second largest in the history of digital assets.

Information about this breakdown from the Ronin technical team was received only on March 29, after users asked not to remove 5,000 ETH from the Ronin bridge. Following this statement, Ronin’s technical support posted an official press release on its blog, which states that the bridge was broken into. According to the information in this report, 5 validator nodes were involved in the Ronin system, as well as one third-party validator controlled by Axie DAO, which is used to verify deposits and transactions made in the Ronin network.

Reasons for hacking

According to Ronin’s technical team, attacks on such a plan could have been avoided thanks to a decentralized network security system. However, this time the attacker would still be able to find the backdoor through the RPC network node.

The report also mentioned the appeal of Sky Mavis, which is the parent company of Axie Infinity, to Axie DAO. The company applied in November 2021 due to a large number of customers to provide a temporary opportunity to sign transactions themselves.

A month later, the signature permit was revoked, but even after the case was considered, the list of permits remained accessible. The Ronin team also confirmed that the hacker was able to obtain a signature from Axie DAO, having previously gained access to the Sky Mavis system. Access to the necessary nodes is what allowed him to commit theft.

Security measures

As a result of this incident, the Ronin technical team closed the bridge over which the funds were withdrawn and took all necessary security measures. Also, the financial exchange Binance has temporarily suspended its bridge to the Ronin system until there is confidence in the security of funds.

In addition, the Ronin team increased the total number of validators from 5 to 8 and improved communication with all security groups of the largest cryptocurrency exchanges. Other security measures include disconnecting from the old infrastructure and suspending DEX Katana.

Ronin Technical Support also points out that it personally monitors the transfer of funds through the Chainanalysis information blockchain platform, which allows them to track transactions in real time. Igor Igamberdiev, director of research at TheBlock, said that the funds were transferred to the wallet of FTX and Crypto.com.The Ronin team is already working with government agencies to bring the perpetrators to justice.

Due to this incident, the token RON decreased its price by 18.4% per day. If before March 23 the price of the token was $ 2.30, now it costs $ 1.81. While the cryptocurrency AXS reduced its value by $ 5 after the hack, the price increased to $ 65 as of March 29, 2022.

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Marta Krysan, Team bit4you.

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bit4you is an european crypto exchange platform. We are facilitating the transition between crypto currencies and traditional currencies such as euro.

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bit4you is an european crypto exchange platform. We are facilitating the transition between crypto currencies and traditional currencies such as euro.

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