Binance has announced that it has led a $150 million USD funding round of Sky Mavis, the creator of leading NFT breakout title Axie Infinity, to restore funds on the Ronin Bridge, with participation of Animoca Brands, a16z, Dialectic, Paradigm and Accel. The round will be used to reimburse user funds affected by the Ronin Validator Hack.
On March 23, Sky Mavis’ Ronin validator nodes and Axie DAO validator nodes were compromised resulting in 173,600 Ethereum and 25.5 million USDC drained from the Ronin bridge.
The attack was socially engineered, and a thorough investigation is ongoing.
“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,” said Binance CEO “CZ” (Changpeng Zhao).
“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.”
The root cause of the breach was the small validator set which made it much easier to compromise the network.
Sky Mavis will onboard up 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 round, combined with Sky Mavis balance sheet funds, will ensure that all users are reimbursed.
The Ronin Network bridge will open once it has undergone a security upgrade and several audits, which can take several weeks.
In the meantime, Binance has opened ETH/USDC withdrawals and deposits which will enable most users to withdraw and deposit.
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 funds are not fully recovered within two years, the Axie DAO will vote on next steps for the treasury.
With the largest NFT gaming ecosystem by total traded volume, Axie Infinity has contributed to accelerating the mass adoption of NFT gaming platforms.
Axie Infinity’s scalability can be attributed to Sky Mavis’ underlying infrastructures which include The Mavis Hub, the distribution platform; Ronin, the proprietary Ethereum sidechain; and Katana, a decentralized exchange for Ronin.
In addition to the funding, Sky Mavis and Binance will work together closely on projects that include exclusive Land NFT sales and enable Binance login via The Mavis Hub.