The Ronin Network, an Ethereum sidechain developed by blockchain gaming platform Axie Infinity, has been compromised. According to a Tuesday community alert from Ronin developers, hackers stole approximately 173,600 ETH (approximately $600 million) and 25.5 million USDC ($25.5 million.)
The Ronin Network bridge as well as Katana (the primary decentralized exchange for Ronin) is unavailable at the time of writing.
(Source: https://katana.roninchain.com/)
Ronin Network Hacked
The Ronin Network hack reportedly took place on March 23, when an unknown attacker exploited validator nodes belonging to Sky Mavis (the gaming company behind Axie Infinity) and Axie DAO (the official validator representing the Axie community).
The Ronin Network currently requires five out of 9 multi-signatures to approve withdrawals from the bridge. Today’s report revealed that Sky Mavis controlled four out of the five signatures required to authorize a withdrawal. Hence, the attacker only needed to hack Sky Mavis private keys to acquire a majority of the validator signatures, while also hacking the Axie DAO to meet the threshold.
The attacker used the stolen private keys to authorize the withdrawal of 173,600 ETH (approximately $600 million) and 25.5 million USDC ($25.5 million) in two separate transactions. The majority of the stolen funds (appr. $606 million) is still being held in the attacker’s address at the time of writing.
Ronin Network Hack Undetected for Six Days
Surprisingly, the Ronin Network development team claim to have only discovered the exploit today, March 29, despite the hack taking place six days earlier. The team was only alerted to the empty bridge when a user reported being unable to withdraw 5000 ETH from the network.
The team is now working together with blockchain forensic firm Chainalysis as well enforcement authorities to monitor the funds as well as demystify the identity of the hacker.
Axie Infinity (AXS) Drops 7% Following Ronin Hack
The price Axie Infinity (AXS) dropped sharply in response to news of the latest Ronin network hack, while also midly impacting the rest of the crypto market. At the time of writing, AXS is trading at $65, representing a 7% decline since the Ronin hack news.
(Source: Coingecko)
Similarly, the price of RON, the native token for the Ronin network, has dropped significantly in the aftermath. At press time, the RON token is seeing 22% in losses having dropped from $2.2 to $1.8.
(Source: Coingecko)
Meanwhile, the Ronin Network hack has become the largest crypto exploit ever, and the second one this year that involves a cross-chain bridge protocol. Last month, Solana-based Wormhole lost over $300 million to a similar exploit.
