Vietnamese gaming studio Sky Mavis has announced it has raised $150 million in funding led by crypto exchange Binance to help repay users who lost funds in a roughly $625 million hack. dollars from his gambling game to win Axie Infinity, which was the biggest crypto heist to date. Animoca Brands, a16z, Dialectic, Paradigm and Accel also participated in the increase, according to Sky Mavis.
The new funds will be combined with cash from Sky Mavis’ balance sheet to reimburse all users who lost money in the attack on Ronin, an Ethereum-based sidechain supporting the game. The company plans to reopen the Ronin Bridge after a security upgrade and audits, which she says could take several weeks. In the meantime, Binance provides liquidity to Ronin users by allowing them to freely withdraw and deposit ETH.
Binance is one of the only major crypto exchanges that directly integrates with the Ronin network and allows users to transfer funds from its platform to a Ronin wallet address. Today’s announcement appears to mark the first time that Binance has directly invested in Sky Mavis.
Sky Mavis also addressed the cause of the attack in its announcement, attributing the breach to the “small set of validators which made it much easier to compromise the network.” The hacker was able to obtain five of the nine keys used to validate the network, enough to allow him to withdraw tokens from the Ronin Bridge into an external wallet. The company said it plans to increase the group of validators from five to 21 validators over the next three months to guard against future risks.
The company generated $1.3 billion in revenue in the 12 months ending February, and Axie Infinity itself has a ‘community treasure trove’ worth $1.6 billion, reports Bloomberg last week. In the hack, 56,000 ETH tokens (worth around $185,000,000 at today’s prices) from the Treasury were compromised – the funds, according to Sky Mavis, will remain unsecured as the company is working with the law enforcement to retrieve them. The Axie community should have held a vote to approve the liquidation of one of the cash funds to reimburse users, which may explain why Sky Mavis opted to raise external funds and use its own balance sheet instead.
It is incredibly difficult to recover funds after a crypto hack, let alone return them directly to users. The majority of the funds are still in the hacker’s wallet, although the hacker appeared to move some 2,000 ETH from the wallet to the Tornado Cash privacy tool, which allows users to hide their wallet address while withdrawing coins. funds.
Axie Infinity has 2.2 million monthly active players and, according to the company, is the most played NFT game of all time. Sky Mavis last raised a $152m Series B round in October 2021, led by a16z alongside other venture capital firms including Paradigm and Accel, all three of which participated in fundraising. ‘today.