White Hat Hacker Saves Millions in Ronin Exploit, Returns $10M

Ronin Network Exploit Shakes Crypto World

The Ronin Network, known for its ties to Axie Infinity, was hit by a major exploit on August 6, 2024. Attackers exploited the Ronin bridge following a network upgrade, withdrawing 4,000 ETH (about $10 million) and $2 million in USDC. They tricked the bridge into misinterpreting the vote threshold for withdrawals, draining $12 million, the bridge’s limit.

Forty minutes after the first on-chain activity, the Ronin team paused the network, stating, “Regardless of negotiations, all user funds are safe, and any shortfalls will be re-deposited into the bridge when it opens up.”  

Surprisingly, the RON token rose by 6% to $1.4 initially after the attack. The network's market cap fell to $475 million from its May peak of $1.3 billion. 

PeckShield’s August 6 update suggested a white-hat hacker may have done the exploit. Specifically, this white hat hacker using an MEV bot accidentally front-ran the attackers, transferring 3,991 ETH to a wallet known as “0x952” or “beaver build.” This ethical hacker returned the ETH worth $10M to the Ronin Network and received a $500,000 bounty.

The Ronin Network publicly praised the white hat hacker, confirming user funds were safe. "We thank the white hats for their vigilance and integrity. The Bug Bounty Program will reward the white hats with a $500K bounty,” the team stated. They are negotiating with all parties involved and assured that any shortfalls will be re-deposited when the bridge reopens.

The Ronin Network also announced intensive audits and plans to overhaul the bridge's structure. They aim to collaborate with Ronin validators to prevent future exploits. This incident underscores the importance of robust security measures and ethical hackers in the crypto ecosystem.

Crypto hacks are on the rise, with $542.7 million stolen in Q1 2024, a 42% increase from the same period in 2023. July alone saw $266 million stolen across 16 incidents, including $234 million from WazirX. 

Ronin Network has a history of security breaches, including the largest DeFi exploit in March 2022, where over $600 million was stolen. This latest incident emphasizes the need for continuous improvements in blockchain security.