Sky Mavis, the firm behind the successful play-to-earn game Axie Infinity, has raised $150 million in a Binance-led round to pay back $625 million in user funds lost in the "Ronin" attack.

Other companies in the funding round included tech venture capital firms a16z and Accel, as well as Animoca, the company behind the popular crypto game The Sandbox. Crypto investment firms Paradigm and Dialectic also contributed in the round.

Axie Infinity

Sky Mavis announced on March 23 that the validator nodes in the Ronin network and the Axie decentralized autonomous organization (DAO) were compromised and hacked. The attacker used private keys to withdraw fake money from the Ronin bridge over the course of two transactions, and was able to steal a total of 173,600 Ethereum (ETH) and 25.5 million USDC. In the past weeks, Vitalik Buterin had warned about these bridges. Vitalik Buterin wrote a special article on this subject and explained that bridge applications carry great risks. Weeks later, one of the biggest hacks in crypto history took place in Buterin's area.

The Ronin attacker managed to exploit this vulnerability by obtaining five of the nine authenticator keys responsible for securing the Ronin network. By holding most of the keys, the attacker was able to maliciously move cryptocurrencies to himself across the Ronin Bridge.

Changpeng Zhao

Binance CEO Changpeng Zhao made an important statement regarding their investment and the popular P2E game.

   “Since working together on the Axie Infinity project at Binance Launchpad, we have witnessed the tremendous work and growth of the Sky Mavis team. We are confident that Sky Mavis will bring significant value and growth to the industry as a whole. We believe it is essential to support them as they work tirelessly to resolve the latest incident.”

Sky Mavis and Axie Infinity will use this fund and the pool on their balance sheets to allow Ronin Network users to freely withdraw and deposit funds. Meanwhile, the Ronin bridge, which allows users to transfer assets from Ethereum to the game, is not expected to be fully operational until it passes audits and security updates. According to Sky Mavis, this could take several weeks.

Sky Mavis

Once the bridge is rebuilt and operational, all users will be able to withdraw their funds. The 56,000 ETH hacked from the Axie DAO treasury will continue to be reallocated as Sky Mavis works with law enforcement to recover the funds. If the funds are not fully recovered within two years, the Axie DAO will vote on the next steps for the treasury.

The attacker behind one of the biggest crypto hacks to date apparently moved 2000 ETH to the privacy tool Tornado Cash earlier this week. These applications, called mixers, are generally used to launder the proceeds of crime. But some democracy advocates think that minorities and dissidents need privacy and argue that mixers are useful for this purpose.