Axie Infinity Co-Founder’s Crypto Wallet Compromised, Losses Reach Nearly $10M

Jeff Zirlin, co-founder of the popular blockchain-based game Axie Infinity, confirmed that his personal crypto wallets were compromised. The breach resulted in the loss of approximately $9.7 million worth of Ethereum (ETH).

This high-profile incident underscores the persistent vulnerabilities in the digital asset space despite a notable decrease in crypto-related crimes in 2023.

Crypto Whale Wallet Hacked and Drained

Zirlin took to Twitter to address the situation, stating,

“This has been a tough morning for me. Two of my addresses have been compromised.”

He emphasized that the crypto wallet hack was confined to his personal accounts and did not impact the operations of the Ronin chain or the activities of Sky Mavis, the company behind Axie Infinity.

“The attack is limited to my personal accounts, and has nothing to do with validation or operations of the Ronin chain,” he reassured.

Security analytics firm PeckShield, monitoring the situation, reported that a “whale wallet” linked to Zirlin had been breached. The attacker withdrew approximately 3,248 ETH from the Ronin Bridge and subsequently transferred to Tornado Cash.

Read more: Tornado Cash: Everything You Need To Know

Stolen crypto moves from Zirlin’s wallet through Tornado Cash. Source: PeckShield

Tornado Cash is a popular and contentious ‘mixing service‘ used to obscure the trail of cryptocurrency transactions.

Will Crypto Hacks Ramp Back Up in 2024?

The incident occurs in the context of a broader trend in the crypto industry. According to PeckShield, the number of hacks, scams, and exploits in the crypto sector decreased by 27.8% in 2023 compared to the previous year.

Despite this decline, the total losses amounted to around $2.61 billion, highlighting the significant financial impact these incidents continue to have. DeFi protocols remain prime targets, accounting for 67% of the total value stolen.

Read more: Identifying & Exploring Risk on DeFi Lending Protocols

Crypto security report. Source: X/@PeckShieldAlert

Zirlin’s experience and the broader industry trends highlight the importance of vigilance and security when custodying your own funds.

Despite this, the Axie Infinity co-founder remains optimistic despite the setback.

“I will keep pushing forward with each and every one of you on this magical journey,” he affirmed

This incident serves as a stark reminder of the ever-present risks in the digital asset space, even as the industry evolves and adapts to counter these threats.

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