Sky Mavis, the company behind the leading Cryptocurrency Play-to-Earn (P2E) NFT game in the world, Axie Infinity, released an official statement on the 29th of March that its Ronin Network, the cryptocurrency blockchain network that bridges the game, its player-based, and the company has been compromised. As a result, approximately $625 Million has been lost—the biggest and most daring hacking incident in Cryptocurrency’s history.

“We realized the Ronin network has been exploited for 173,000 [Ethereum] and around 25 million dollars in USDC,” Jeff ‘Jihoz’ Zirlin, Axie Infinity’s Co-founder. The hack took place on the 23rd of March, almost a week before Zirlin says he was made aware of it.

According to Axie Infinity’s blog post, the network pledged to “ensure no users’ funds are lost”. The company said most of the stolen funds currently remain in the hacker’s crypto wallet. “We are working with law enforcement officials, forensic cryptographers, and our investors to make sure that all funds are recovered or reimbursed,” the company tweeted.

The former chief of the Security and Exchange Commission’s Office of Internet Enforcement, John Reed Stark, gave a statement that the latest hack “is a sobering reminder of just how vulnerable Web 3.0 marketplaces are to cyber-attacks.”

“The entire Web 3.0 marketplace is so fraught with chaos and lawlessness, we may never learn the truth about what happened,” said controversially by Stark. “And unlike US financial firms who must report cyber-attacks fairly, accurately, and promptly. Non-fungible Tokens (NFTs) and other Web 3.0 marketplaces do not have to report anything at all.”

IN AN OFFICIAL STATEMENT, the US Treasury Department said that a group known as “Lazarus” from North Korea was behind the momentous theft. It came after the Federal Bureau of Investigation (FBI) successfully identified the digital currency address used by the hackers, and they concluded that it was under the control of a North Korean hacking group. Following this, the US Treasury Department has sanctioned the address that received the extracted assets.

“The United States is aware that the Democratic People’s Republic of Korea (DPRK) has increasingly relied on illicit activities — including cybercrime — to generate revenue for its weapons of mass destruction and ballistic missile programs as it tries to evade robust US and United Nations sanctions,” the Treasury Department said.

The US Department added that the infamous Lazarus hacking group is controlled by North Korea’s primary intelligence bureau, the Reconnaissance General Bureau (RGB). It has a history of accusations of hacking International Banks and their respective customer accounts, the 2014 cyberattacks on Sony Pictures Entertainment, and involvement in the “WannaCry” ransomware attacks.

Hacks have long plagued crypto platforms. Nevertheless, the Ronin Network hack is the largest and most prominent cryptocurrency heist to date. Sky Mavis, the company behind Axie Infinity, said it would use a combination of its very own private funds and $150 million raised from institutional and retail investors, including the largest cryptocurrency exchange in the world, Binance, to reimburse the stolen assets successfully. The US Treasury Department articulated that it would look into publishing cryptocurrency cybersecurity guidelines to enhance protection against fraudulent cryptocurrency-related activities in the future.