Axie Infinity's Ronin Bridge Reopens For the First Time Since $600 Million USD Hack

Three months after a devastating Axie Infinity hack that saw $600 Million USD worth of user funds stolen from the Ronin Bridge protocol, Sky Mavis-the developers of the game has announced that it is reopening the blockchain bridge once again, after several internal and external audits. All user funds are fully backed on a 1:1 basis by the new bridge and users have been made whole, developers said in the announcement.

The Axie Infinity Ronin Bridge hack is one of the most high-profile exploits in Blockchain Gaming and took place on 29 March. 173.6 Thousand ETH and 25.5 Million USDC were drained from the network after hackers managed to gain unauthorized access to private validator keys.

Axie Infinity tightens its security

Axie Infinity announced that they have conducted three audits(one internal, two external) in a measure to bolster their security. The report that Sky Mavis released after the hack, highlighted the lack of decentralization as one of the key problems. Hence these new changes focus on decentralizing the power to thwart any future hacks.

The company has revealed a contingency plan called “Ronin Circuit Breaker System” that is designed to flag “large, suspicious withdrawals,” introduces a withdrawal limit, and adds “human reviewers” to verify transactions on the Ronin Bridge.

These withdrawal limits would function in a tier-based system with tier one being for withdrawals for less than $1 Million USD and requiring 70% of the validator signatures, tier two for withdrawals exceeding $1 Million and requiring 90% of validator signatures, and tier three with withdrawals exceeding $10 Million. All withdrawals of tier 3 would require 90% validator signatures and human review. A small transaction charge will also be levied and it will be subject to a seven-day review process.

User Funds to be reinstated as promised

Sky Mavis announced that user funds that were stolen in a $600 Million hack will be reimbursed as promised. A total of 117,600 ETH and 25.5 Million USDC will be recompensed 1:1 by providing ETH liquidity to the user’s wETH (wrapped Ether) on the Ronin Network.

They also added that the remaining 56,000 wETH that belonged to the Axie DAO treasury, will remain undercollateralized. In the meantime, Sky Mavis will be working closely with law enforcement to recover the funds. If the funds are not recovered within two years, then the Axie DAO would vote and decide the next step.

In April, Sky Mavis raised $150 Million in funding with Binance leading this round of investments. The company had stated that this would be used to reimburse user funds affected by the attack on the Ronin Network.

Future Plans for Axie Infinity:

Sky Mavis also talked about their plans for Axie Infinity and updates that are about to go live soon. One of the key features that the entire community is looking forward to is the land staking. On the other hand, Axie Infinity Origin is also making huge progress after registering 600,000 accounts.

The phase plans for Axie Infinity Origin starts with balance changes in phase one and focus on the progression reset of Moonshards, MMR, and Rune in phase two. Phase three will see the introduction of SLP rewards and NFT Runes/Charms. The final phase, phase four will prepare for global launch season 1.

Earlier this month, Bloomberg reported that Axie Infinity had lost 40% of its user base since the hack. At the time of writing, the value of AXS is at $15.30 (a drop for its $160.36 peak in July 2021) while the value of SLP is at 0.0039 (down from its peak of 0.364 in July 2021). It will be interesting to see if the game can regain some of its lost users following this move.