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Axie Infinity recovers $5.7m lost in Ronin hack with Norwegian authorities, $40m underway

By:
on Jun 7, 2024
Updated: Jun 11, 2024
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  • Authorities recovered $5.7 million and froze an additional $40 million in assets from the 2022 hack.
  • Sky Mavis worked with Norwegian authorities, the FBI, and Chainalysis to facilitate the recovery.
  • Portion of the recovered funds will be deposited into the Axie Infinity treasury.

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Authorities in Norway have managed to recover $5.7 million from the infamous Ronin Bridge hack. The platform was attacked in 2022 and lost over $600 million.

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The recovery effort was the result of a massive collaboration. Sky Mavis, the firm behind Axie Infinity, collaborated with the National Authority for Investigation and Prosecution of Economic and Environmental Crime.

Ronin Bridge funds recovered

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Sky Mavis wrote in an X post:

Recovery of these assets requires close coordination and dedicated effort amongst law enforcement agencies, lawyers, accountants, and blockchain forensic teams such as Chainalysis.

The group worked closely with the U.S. Federal Bureau of Investigation and blockchain forensic firm Chainalysis to freeze the assets.

85%% of the assets recovered would be deposited to the Axie Infinity treasury. The other 15% would be used to cover costs incurred during the recovery process.

Authorities also managed to freeze an additional $40 million in assets. However, the firm noted that it would “take some time” before it can be recovered.

Further, it added that not much information was available regarding these assets, stating:

These assets will take some time to recover and we don’t have enough information to give guidance around a specific timetable for recovering and returning this separate pool of assets.

History of the Ronin hack

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Ronin is a sidechain designed to power the Axie Infinity platform. The platform was compromised on March 29, 2022. 

That attack was targeted towards the Ronin bridge, which was the route to transfer assets between Ronin and the Ethereum main chain.

It was reported that the attacker tricked an insider into applying for a fake job. The recruitment process saw the insider’s system infected with malicious code.

The exploit allowed the attackers to access the company’s internal systems. Subsequently, the attackers took control of five out of nine validator private keys.

The Ronin network uses a proof-of-authority (PoA) consensus mechanism, which operates using a small number of validators. As such, the hacker was able to gain control over the validator nodes.

With this access, the attackers managed to execute one of the biggest hacks in the history of cryptocurrency. 173,600 ETH and 25.5 million USDC from the Ronin bridge were stolen.

The funds were worth approximately $612 million at the time.

The attack went unnoticed for days until a user reported not being able to withdraw 5,000 ETH from the bridge.

Subsequently, in April 2022, Sky Mavis managed to raise $150 million to reimburse the victims. The funding round was led by crypto exchange Binance.

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