Image: Axi Infinity
Sky Mavis, the developers of the regular “play-to-earn” NFT-based game Axi Infinity, is now fighting allegations that officials transferred funds from the main game as the attack was underway, even before the company Announced that users had been duped.
Bloomberg first reported last Thursday about an apparent transaction made by Trung Nguyen, CEO of Mavis, from the Axi blockchain to crypto exchange Binance, the equivalent of $3 million worth of Axi’s main token, AXS. This apparently happened while the blockchain was in the midst of a massive hack, and before they announced they were freezing the ability for users to mine their own tokens as well.
Hackers breached Axi Infinity’s sidechain Ronin Network on March 23, stealing approximately $600 million worth of Ether and USDC stablecoins over the course of a week before they finally closed the Ronin Bridge. It was the largest crypto theft ever in the history of crypto theft (and it has a long, long history) and the FBI tracked the theft to the Lazarus Group, a North Korean-affiliated collective. In July, according to The Block, the hack was traced back to fake job offers posted on LinkedIn.
In a series of tweets published just after Bloomberg released his report, Nguyen essentially confirmed that the transaction was his work, adding that it was an attempt to “provide liquidity” when Ronin users were finally able to withdraw from the blockchain. You will be able to withdraw your money. His thread mentions other top AXI execs who gave Nguyen over 750,000 in AXS which he then transferred to the Binance exchange. This, the founders said, was an attempt to ward off any short-sellers, even claiming that the founders deposited $7.5 million from the shared wallet to the Ronin Network “any short-sellers.” To avoid seeing the seller.”
In addition to the Bloomberg investigation, a separate video from crypto news YouTube channel Esobes identified the name of Nguyen’s wallet and the transfer of funds through similar names between Nguyen’s Twitter handle and his identifier on Crypto Transfer. Esobes echoed Nguyen’s point that adding liquidity would help users get their crypto out after such a massive hack, but he further questioned How the Company’s Early Claims That Only the Founders Knew About the Hack Even when Binance clearly knewAnd why other wallets were pulling their crypto too.
Nguyen wrote that the allegations of insider trading are “baseless and false”, adding that the founding team deposited $7.5 million to Ronin from a known shared wallet prior to the bridge’s closure. The founder also explained that the bridge has been reopened and the users’ lost crypto has been returned to them. However, according to CoinMarketCap, AXS was priced at $64 before the hack, and is now priced closer to $18.
Although, of course, there is still a cloud over the whole affair, especially with the allegation that some people in the company were selling their tokens during the breach. At the end of June, Sky Mavis released series of tweets Claiming that before the breach was discovered by the company, employees were selling their tokens as the price of the tokens increased by about 49%. The company further said that neither Sky Mavis nor Axi employees were made aware of the pre-official announcement of the breach, with the founders “working closely with Binance operations and providing liquidity for Ronin.”
There is really nothing left to say about a game that promises users that they can play and earn money at the same time, and during the pandemic it has taken a positive spin for itself with this idea. made that it offered jobs to workers working in places such as the Philippines. According to a recent report in Time, players said that their lives were practically ruined by the game, brought in with pyramid-plan-like promises that they would earn much more than they would at a regular job. But the model gradually disbanded as more players were brought in, forcing lower-level workers to splurge for money and forcing them to grind for hours on end.