Sky Mavis, the creator of the leading NFT breakout title Axie Infinity, today announced a $150 million funding round led by the global blockchain company behind the world’s largest crypto exchange Binance, with participation from Animoca Brands, a16z, Dialectic, Paradigm, and Accel. Sky Mavis will use the round to reimburse user funds affected by the Ronin Validator Hack. In addition to the funding, Sky Mavis and Binance will work together closely on entire land sales projects and enable Binance login via The Mavis Hub.
Axie Infinity has become the largest NFT gaming ecosystem by total traded volume. The game’s scalability can be attributed to Sky Mavis’ underlying infrastructure: The Mavis Hub, the distribution platform; Ronin, the proprietary Ethereum sidechain; and Katana, a decentralized exchange for Ronin.
On March 23, 2022, Sky Mavis’ Ronin validator nodes and Axie DAO validator nodes were compromised, resulting in 173,600 Ethereum and 25.5 million USDC being drained from the Ronin bridge. The attack was socially engineered, and a thorough investigation is ongoing. The root cause of the breach was the small validator set which made it much easier to compromise the network. Sky Mavis will increase the validator group to 21 validators within the next three months, which will be a split between various stakeholders in the Axie community, and will together manage an open-source codebase.
The new funding round, combined with Sky Mavis & Axie Infinity balance sheet funds, will ensure that all users can withdraw and deposit freely.
“Sky Mavis is committed to reimbursing all of our users’ lost funds and implementing rigorous internal security measures to prevent future attacks. With the support of Binance and other industry leaders, we will be able to quickly expand the validator set from five to 21 validators to ensure the security of the Ronin network. While we address this issue, we are also focusing on the future, starting with tomorrow’s launch of Axie Infinity: Origin. We are also thrilled to collaborate with Binance NFT on future projects.”
Trung Nguyen, Sky Mavis CEO.
The Ronin Network bridge will open after a security upgrade and several audits, which could take several weeks. In the meantime, Binance supports the Ronin Network by providing ETH withdrawals and deposits for Axie Infinity users, enabling most of them to operate freely. Once the Ronin Network bridge is open, all individual users will be able to withdraw their funds. The 56,000 ETH compromised from the Axie DAO treasury will remain undercollateralized as Sky Mavis works with law enforcement to recover the funds. If the stolen funds are not fully recovered within two years, the Axie DAO will vote on the next steps for the treasury.
“In order for the global ecosystem to continue thriving and maturing, it is imperative that we work together, especially when it comes to security, which is our strong suit. We have seen the tremendous work and growth of the Sky Mavis team since working together on the Axie Infinity project on Binance Launchpad. We strongly believe Sky Mavis will bring a lot of value and growth for the larger industry, and we believe it’s necessary to support them as they work hard to resolve the recent incident.”
Changpeng “CZ” Zhao, Binance CEO.
