Web3 company Mixin Network has officially informed its community members about a mega exploit that drained $200 million (approximately Rs. 1,662 crore) from its account. The platform offers a decentralized wallet service and was launched in 2017 with a total value of one billion dollars. Last weekend, the database of Mixin Network’s cloud service was hacked, resulting in a multi-million dollar loss. The platform is working with cybersecurity company SlowMist to get to the bottom of this matter.
Feng Xiaodong, the founder of Mixin Network, addressed the incident in a livestream on September 24 and assured community members that possible solutions are being discussed.
Meanwhile, the company has formally recognized the agency through their X-handle.
“Mixin Network’s cloud service provider database was attacked by hackers, causing the loss of a number of assets on the mainnet. We will do our best to minimize the losses and deeply apologize for them,” the statement said.
For now, the Mixin team has seen fit to temporarily suspend all deposit and withdrawal services.
[Announcement] In the early morning of September 23, 2023, Hong Kong time, Mixin Network’s cloud service provider database was attacked by hackers, causing the loss of a number of assets on the mainnet. We contacted Google and the blockchain security company @SlowMist_Team…
— Mixin Kernel (@MixinKernel) September 25, 2023
The losses incurred through this exploit have significantly affected the platform’s coffers. According to a CoinDesk report, the top 100 assets on Mixin Network were barely above $1.1 billion (approximately Rs. 9,145 crore).
Since news of this hacking attack started spreading to social media, the platform’s native XIN token plummeted by eight percent. According to CoinMarketCap, XIN is currently trading at $194 (approximately Rs. 16,130).
However, this isn’t the first time a blockchain company’s centralized server has traditionally been hacked by cybercriminals.
Last year, a report from blockchain research firm CertiK said that “centralization runs counter to the ethos of DeFi and poses major security risks, and that single points of failure can be exploited by dedicated hackers and malicious insiders.”
Researchers have also previously noted that elements of the crypto space, such as the DeFi sector, would become increasingly secure as workloads shift from servers to blockchain networks.
Money stolen in crypto frauds, hacks and rug pulling crossed the $656 million (roughly Rs. 5,454 crore) mark in the first half of 2023, said a report by Web 3.0 security firm Beosin in July.