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‘Axie Infinity’ CEO moved $3 million in crypto tokens before disclosing massive hack

On March 23rd, hackers broke into Axie Infinity’s Ronin network to steal Ethereum and USDC stablecoins that were then worth over $600 million. In response to the massive theft, Axie developer Sky Mavis disabled token withdrawal — but apparently not before its CEO moved $3 million worth of Axie’s main token, AXS, into Binance. According to Bloomberg, company CEO and co-founder Trung Nguyen made the large transfer mere hours before Sky Mavis disclosed on March 29th that the “play to earn” game was hacked. 

It was YouTube user Asobs who first identified the transaction and who shared his documentation with Bloomberg. The news organization then worked with associate professors of mathematics at Winthrop University to confirm his findings. Asobs analyzed the transaction details and connected it to a wallet controlled by Nguyen based on previous transactions, such as the initial distribution of tokens for the game during its early years. 

When asked, company spokesperson Kalie Moore has confirmed the transaction to Bloomberg. Moore said Nguyen made the transfer to shore up the company’s finances and ensure it could provide liquidity to its users. Nguyen apparently had to do so on the down-low so that people tracking official Axie wallets wouldn’t be able to front-run the news and cash out before the rest of the players even find out what’s going on.

Moore said:

“At the time, we (Sky Mavis) understood that our position and options would be better the more AXS we had on Binance. This would give us the flexibility to pursue different options for securing the loans/capital require. The Founding Team chose to transfer it from this wallet to ensure that short-sellers, who track official Axie wallets, would not be able to front-run the news.”

Nguyen posted a Twitter thread after Bloomberg’s report went up and said that his team had been in contact with Binance after the hack was discovered to “ensure user funds would be restored as soon as possible.” The executive added: “This discussion included the fact that Sky Mavis would provide liquidity while we worked on a full backing of the bridge.” He also called speculations of insider trading as “baseless and false.”

In Axie Infinity, people can earn cryptocurrency by playing the game and completing tasks, such as winning Arena battles and breeding Axie monsters, which are non-fungible tokens. The attack on its Ronin network is now known as one of the biggest in crypto history. According to previous reporting by The Block, bad actors gained entry into its system by sending a spyware-filled PDF to one employee who thought he was getting a job offer with higher pay from another firm. Turns out the company didn’t exist, and the offer, according to the US government, came from North Korean hacker group Lazarus.

Sky Mavis has secured $150 million in funding to help reimburse users since then, and Nguyen said all players’ funds are now backed 1:1. The value of Ethereum dropped considerably since March, however, so players will not get the money they could’ve gotten if they had cashed out months ago. As for the game itself, it opened back up in late June with a new system to flag “large, suspicious withdrawals” and a new land-staking feature that enables players to earn passive income.

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Game

E3 2021 dates moved, Nintendo and Xbox confirmed for all-digital show

Last week, in response to a report claiming that the ESA was considering sticking some parts of E3 2021 behind a paywall, the organization confirmed that the digital show will be free for all while also saying that it would have more details to share in the near future. Today, some of those details came down the pipeline, with the ESA confirming new dates for E3 2021 and a list of exhibitors who have signed on for the show early.

Kicking things off, it seems that the dates for E3 2021 have shifted forward a little bit. Last year, shortly following the cancellation of E3 2020, the ESA announced that E3 2021 would take place June 15th – June 17th. With today’s announcement, those dates have moved up to June 12th through June 15th.

The ESA also confirmed an early list of exhibitors who have committed to the show. The list so far includes “Nintendo, Xbox, Capcom, Konami, Ubisoft, Take-Two Interactive, Warner Bros Games, Koch Media, and more to come” according to an ESA press release today. Eagle-eyed readers will notice that Sony is missing from that list, but that doesn’t come as much of a surprise considering that Sony sat E3 2019 out and announced it wouldn’t be attending E3 2020 before it was ultimately cancelled.

The ESA also reiterated today that E3 2021 will be an “all-virtual show,” owing to the COVID-19 pandemic. “Developers will be showcasing their latest news and games directly to fans around the world. The ESA will be working with media partners globally to help amplify and make this content available to everyone for free,” the organization said in its announcement today.

Today’s announcement was pretty light on details regarding what the show will actually entail, though we can definitely expect more information as we close in on the event. The ESA does close its announcement by saying that it’s aiming to host E3 2022 as an in-person event, but for now, all eyes on are the digital event lined up for June. We’ll let you know when more about the show is revealed, so stay tuned.

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