Ronin, the Ethereum (ETH) sidechain, has just announced that it suffered a hack as of March 23 of $550 million at the time of the incident. As a result, more than 173,600 ETH and 25.5 million USDC were stolen from Ronin’s bridge, which is the second largest hack in the history of cryptocurrencies behind that of Poly Network.
Ronin suffered the second largest hack in history
Ronin, an Ethereum (ETH) sidechain dedicated to the Axie Infinity (AXS) blockchain game, suffered the loss of 173,600 ETH and 25.5 million USDC through a hack that took place on March 23. This represents $552 million at the time of the theft, making it the second largest hack in the history of cryptocurrencies just behind Poly Network’s $611 million.
Ronin’s tech team only became aware of the hack today after a user reported that they were unable to withdraw 5,000 ETH from Ronin’s bridge.
An official statement has just been published by the Ronin team via its blog, explaining that it is therefore its bridge that seems to have been affected.
According to this report, 5 of the Ronin network’s validator nodes have been exploited, as well as a third-party validator controlled by Axie DAO. These are typically required to validate deposits and withdrawals made on the Ronin network.
According to the Ronin team, the network’s security scheme is structured in such a way that attacks of this type are avoided, including through decentralization of the network, but the hacker still managed to find a backdoor system via an RPC node in the network.
According to the report, Sky Mavis, the parent company of Axie Infinity, requested Axie DAO’s help in November 2021 when it was faced with an excessive influx of users, allowing it to sign transactions for them for a set period of time.
The permissions had been revoked the following month, but access to the authorization list would still have been possible afterwards. This is what allowed the hacker to obtain Axie DAO’s signature after gaining access to the Sky Mavis network. This was confirmed by the Ronin team.
Once the necessary nodes were under his control, the hacker was thus able to drain over 173,600 ETH and 25.5 million USDC.
What measures have been taken?
The Ronin team says that the necessary precautions were then taken to prevent more damage from being done. Ronin’s bridge has been completely shut down to prevent any further leakage of funds, and the Binance platform has also paused its bridge to the Ronin network. The latter should be reopened once it is assured that all remaining funds are safe.
An additional security measure has also been implemented, as the number of validators required has been increased from 5 to 8 as a result of the hack. Ronin also reported that it has been in contact with all the security teams of the major exchanges.
Ronin also said that its nodes are currently being migrated to completely separate from its old infrastructure. The Katana DEX has also been put on hold until further notice.
In addition, Ronin said it was working with Chainalysis to monitor the direction of funds in real time. According to Igor Igamberdiev, research director at TheBlock, the funds were sent to wallets held on FTX and Crypto.com.
Finally, the article states that the team was already working with various government agencies to ensure that those responsible are brought to justice.
The RON token lost 18.4% of its value in 24 hours, dropping from $2.30 to $1.81. AXS, the Axie Infinity token, dropped in value by $5 following the announcement of the hack, bringing its value to $65 at the time of writing.
