Bridge from Ronin to Axie reopens after $600 million hack

Bridge from Ronin to Axie reopens after 0 million hack

Sky Mavis, developers of the popular non-fungible token (NFT) game Axie Infinity, have announced that the Ronin Bridge is back online three months after it was hacked for over $600 million..

The Ronin Bridge is an Ethereum sidechain built for Axie Infinity, and allows users to transfer assets between the sidechain and the Ethereum mainnet..

On March 29, 173,600 Ether (ETH) and 25.5 million USD Coin (USDC) were drained from the bridge after hackers gained access to validators’ private keys.. The hack was valued at more than $620 million at the time.

According to Tuesday’s announcement from the Sky Mavis team, the Ronin Bridge is back online after three audits (one internal and two external), a redesign, and full compensation for stolen user assets:

“All wETH and USDC owned by Ronin Network users are now fully backed 1:1 by ETH and USDC on Ethereum, as promised. All users have been compensated.”

Total, Sky Mavis has now redeemed 117,600 ETH and 25.5 million USDC, providing the ETH liquidity to back users’ Wrapped ETH (wETH) on the Ronin network.

In April, around 46,000 of that ETH had already been cleared after Binance provided a bridge to its exchange so users could exchange wETH for ETH.. Liquidity was sourced from Axie Infinity balance and founder funds to support the move. Binance also led a $150 million funding round to help Sky Mavis refund Axie Infinity users..

The remaining 56,000 of the total stolen ETH belongs to Axie’s DAO Treasury and will remain unsecured while Sky Mavis “works with law enforcement to recover the funds”.

As part of the renewed design of the bridge, Sky Mavis has updated the smart contract software to allow validators to set daily withdrawal limits, and the initial amount is set to $50 million at this stage. The team has also introduced a switch system that divides the monetary value of withdrawals into three levels.

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Level 1 is for withdrawals less than USD 1 million and requires the signature of 70% of the validators, and level 2 is for amounts greater than USD 1 million and requires the signature of 90% of the validators. Tier 3 is for withdrawals over $10 million and requires 90% validator signatures, a small transaction fee, and a seven-day review process:

“The new bridge design includes a contingency plan switch system that increases bridge security by stopping large suspicious removals.”

Sky Mavis admitted in a postmortem report in late April that its lack of decentralization had made the Ronin Bridge vulnerable to hacking.. At the time, it only had nine validator nodes, and employees had access to four of them.

After quickly raising the number of nodes to 11, Sky Mavis outlined its intentions to increase the count to 21 within three months of postmortem.with the long-term goal of exceeding 100 total nodes.

Nevertheless, the team did not provide an update on how many validator nodes the Ronin network now has in the latest announcement.

Axie Infinity has seen its monthly NFT sales volume plunge dramatically in 2022. CryptoSlam data shows that the game went from generating $126.4 million in January to just $2.8 million in June.

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