Axie Infinity Co-Founder’s Wallet Hacked
On Thursday night, the co-founder of Axie Infinity, one of the most popular blockchain-based games, fell victim to a hack. The hacker managed to withdraw a significant amount of Ethereum (ETH) from the co-founder’s wallet and sent it to Tornado Cash, a crypto mixer service. The suspicious activity was detected by a blockchain investigator who flagged the compromised wallet over the Ronin bridge.
Almost $10 Million in Stolen Funds
Web3 security platform Ancilia was the first to report an alleged security breach involving the Ronin Bridge. At that time, around 2,790 ETH had already been withdrawn and deposited into Tornado Cash.
The co-founder of Axie Infinity clarified that neither the Ronin bridge nor the chain itself had been compromised. Instead, it was a case of a compromised wallet where the funds were “tornado cashed.” This means that the stolen funds were sent through a crypto mixer to obfuscate their transaction history and make tracking them more difficult.
Although these mixers are commonly used by hackers, they are actually designed to protect user privacy. However, Tornado Cash has faced regulatory scrutiny in the US for allegedly failing to implement effective controls.
The co-founder assured the community that the Ronin bridge has top-notch security measures in place and has undergone several audits. Additionally, it is programmed to pause when large quantities of funds are being withdrawn suspiciously to prevent major exploits.
However, a blockchain investigator later confirmed that a whale wallet had indeed been compromised, and a total of 3,248 ETH (approximately $9.7 million) had been stolen. The theft involved multiple transactions and three different wallets. The stolen funds were moved between these wallets before being deposited into Tornado Cash to further complicate the tracking process.
Axie Infinity Co-Founder’s Personal Addresses Compromised
Some users raised doubts about the co-founder’s clarification, pointing out that even though the Ronin bridge was not compromised, the hacked wallet appeared to be under the control of the Ronin Network Team.
Another co-founder of Axie Infinity addressed these concerns and confirmed that the compromised wallets belonged to him personally and were not related to the Ronin chain or operations at Sky Mavis, the creator company of Axie Infinity. He explained that the hack occurred due to leaked keys and emphasized that it did not affect the validation or operations of the Ronin chain.
The co-founder reiterated the security measures implemented for all chain-related activities and expressed gratitude to those who offered support during this challenging time. He pledged to continue pushing forward with the community on their mission to bring economic freedom to all internet users, starting with gamers.
Hot Take: Heightened Security Measures Needed in the Crypto Space
The recent hack of an Axie Infinity co-founder’s wallet highlights the ongoing security challenges faced by the crypto industry. Despite the assurance of top-notch security measures, hackers are still finding ways to compromise wallets and steal funds. This incident serves as a reminder that individuals and companies must remain vigilant and take extra precautions to protect their crypto assets.
While crypto mixers like Tornado Cash are intended to protect user privacy, they have also become tools of choice for hackers to obfuscate stolen funds. Regulators need to find a balance between privacy protection and preventing illicit activities in the crypto space.
It is crucial for crypto enthusiasts and investors to secure their wallets with strong passwords, enable two-factor authentication, and regularly update their software. Additionally, platforms and projects should prioritize security audits and implement robust security protocols to minimize the risk of hacks and protect user funds.
As the crypto industry continues to grow and attract more attention from malicious actors, it is essential for all stakeholders to work together in strengthening the security infrastructure and fostering a safe environment for users.
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