Market Analysis Report (30 Mar 2022)

Axie Infinity’s gaming-focused sidechain Ronin Network has been hacked for over $625 million worth of USDC and ether (ETH). The hack saw an attacker use “hacked private keys in order to forge fake withdrawals” from the Ronin bridge.

According to a blog post from Ronin’s official Substack, the exploit affected validator nodes for Sky Mavis, who are the publishers of the popular Axie Infinity game and the Axie DAO. While the sidechain has nine validators and requires five signatures or withdrawals, the attacker “found a backdoor,” the post adds.

The Ethereum address of Ronin’s attacker is a fresh one that transferred ETH in from Binance a week ago. At the time of writing some funds have been sent out to other addresses and the Ronin Bridge and the Katana automated market maker have been paused.

The post details Ronin lost 173,600 ETH and 25.5 million USDC tokens., making it the largest hack a decentralized finance protocol has seen to date. In August 2021, a hacker stole $611 million from cross-chain decentralized finance protocol Poly Network, but returned the majority of the funds.