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$625M worth of ETH drained on Axie Infinity's Ronin Network

roninblockchain.substack.com

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Re: $625M worth of ETH drained on Axie Infinity's Ronin Network

#461

Post by manquer »

colinmhayes wrote: post #335
Dig1t wrote: post #20

So they now have this giant sum of money sitting in their wallet https://etherscan.io/address/0x098b716b8aaf21512996dc57eb061... what do they do next? How do criminals even use this money to do anything?

Others have talked about how you can use DeFi swappers, which absolutely will allow the hacker to convert a couple million per year into clean crypto if done meticulously, but the big problem is that they can't explain where the crypto came from. I don't think that's a death sentence, as you can still pay taxes and what not even if you can't explain where the coins came from, but if law enforcement catches onto you y…

Traditionally real world art market was a vehicle for illicit wealth transfer too. A good chunk of the art today is valued so high because of the illegal money that supports it .

Re: $625M worth of ETH drained on Axie Infinity's Ronin Network

#462

Post by acdha »

narrator wrote: post #429
afpx wrote: post #164

Earlier quoted context omitted.

Where in the world is it common to lose all money deposited in a bank? And, why not just create better banks?

In Argentina, in 2002, they took everyone's dollars denominated accounts at the Argentinian banks, converted them to Pesos and devalued the peso by 75%. Everyone in the country now had 1/3 of the money they previously had. The country is arguably still recovering from that theft. Currently, people who left Ukraine are finding out that their Ukrainian credit cards no longer work. Some people who have bitcoin are still…

Okay, now think about what would happen if Argentinians used Bitcoin. The same government would use the same powers to make the same request. Any business which accepted or made transactions in unapproved currencies would be punished. Any person keeping their money in a local exchange - as almost all Bitcoin users do given how expensive it is to do it solo - would have the seizure done automatically. The blockchain would be monitored by the government to identify non-compliant users — better hope you have perfect opsec and everyone have or will use it with does too! – and anyone whose lifestyle is incompatible with their declared income is going to be at risk, too.

There just isn’t a technical fix for a political problem. If you live under the jurisdiction of a government there’s such a wide range of mechanisms available for enforcement.

Re: $625M worth of ETH drained on Axie Infinity's Ronin Network

#463

Post by uncletammy »

tenuousemphasis wrote: post #385
EVa5I7bHFq9mnYK wrote: post #362

Earlier quoted context omitted.

That's exactly the situation in Bitcoin second layer now. There are a few centralized servers (lnbig etc) handling almost all transactions. Get out and stay out.

It's not at all. The worst thing a centralized server can do in Lightning is refuse to route your transactions. Their peers have the keys and the pre-signed transactions necessary to unilaterally withdraw their funds from the channel.

> The worst thing a centralized server can do in Lightning is refuse to route your transactions.

This is called censorship, the very thing Bitcoin was created to circumvent.

It's an especially big problem given the fact that the vast majority of lightning payments are routed through lightning nodes operated by centralized cryptocurrency exchanges. Most of the remaining nodes on the lightning network are unreliable due to shortcomings in the lightning protocol surrounding state management, node connectivity, and inbound/outbound liquidity. That's not even getting into the abysmal incentive structure node operators face.

Re: $625M worth of ETH drained on Axie Infinity's Ronin Network

#464

Post by cinntaile »

ejb999 wrote: post #459
cinntaile wrote: post #437

Earlier quoted context omitted.

> You are building systems that are ruining peoples lives and making things worse for everyone. Don't invest more than you can afford to lose, it's the basis of any investment strategy. If someone puts enough money into highly risky, speculative assets such as these that it would ruin their life, then they only have themselves to blame if you ask me... People have to take responsibility for their own choices. Edit: -…

Its not really supposed to be an 'investment' - anymore than the dollar is an investment? If crypto wants to replace dollars, they are going to have to do better than this. Would you tell someone who's dollars are stolen 'don't have more dollars than you can afford to lose'?

I think Axie Infinity is some sort of NFT game? How is that going to replace the dollar?

Re: $625M worth of ETH drained on Axie Infinity's Ronin Network

#465

Post by mardifoufs »

rchaud wrote: post #358
dylan604 wrote: post #325

Earlier quoted context omitted.

Depends on if the studio's bank account has security questions like "mother's maiden name", "first concert", etc type stuff and an employee with those answers that like to take quizzes on facebook. Otherwise, it could be quite simple to drain the account

It could, yet it doesn't. For one thing, most business accounts do not hold 9 figures in cash. Inflows and outflows are likely to be predictable, so you can set flags for certain thresholds. A 9 figure transaction would absolutely be noticed, and possibly flagged before it was permitted to continue.

What do you mean not common? Bank account fraud is extremely common here in montreal, it even has a slang name "peter des guichets". It's probably much more common than crypto fraud here, and up until a couple of years ago it was so easy that your average person with no real technical knowledge could do it. Reversing an interac transfert here is just very very hard to do too

Re: $625M worth of ETH drained on Axie Infinity's Ronin Network

#466

Post by cinntaile »

warent wrote: post #451
cinntaile wrote: post #437

Earlier quoted context omitted.

> You are building systems that are ruining peoples lives and making things worse for everyone. Don't invest more than you can afford to lose, it's the basis of any investment strategy. If someone puts enough money into highly risky, speculative assets such as these that it would ruin their life, then they only have themselves to blame if you ask me... People have to take responsibility for their own choices. Edit: -…

Hideous victim blaming mentality here.

I'm not blaming someone for getting scammed, that's on the scammer. But I am blaming someone for ruining their own life if they put more money into a speculative, highly risky asset than they can lose. This isn't confined to crypto, it can also be regular stocks or other investments. I mean this in a general sense. I don't mean people taking advantage of people that aren't in the right state of mind (for whatever reason) to be clear, of course I don't put the blame on those people.

Re: $625M worth of ETH drained on Axie Infinity's Ronin Network

#467

Post by manquer »

leifg wrote: post #143
Dig1t wrote: post #20

So they now have this giant sum of money sitting in their wallet https://etherscan.io/address/0x098b716b8aaf21512996dc57eb061... what do they do next? How do criminals even use this money to do anything?

I had multiple arguments around situations like this. There are essentially two camps. The one side says: - You can sell for cash, use mixers, NFT sales, $other_sophisitacted_technology and get away with it The other side argues: - You won't be able to ever cash out this sum and law enforcement will use sophisticated data mining on the blockchain and will eventually bust you I think in reality it is like any illicit…

The $5b bitcoin recovery recently had the same problem.

Even if you converted 650m to cash it will be hard to move that around as well. At large numbers it is easy to flag for LEO in the economy crypto or traditional.

This kind of theft requires a mindshift change to be really successful, instead of thinking as 650m the hacker should think as few hundred thousands in annual income forever.

The amount you can safely move will increase as the market volume increases.

Re: $625M worth of ETH drained on Axie Infinity's Ronin Network

#468

Post by acdha »

tornato7 wrote: post #442
jandrese wrote: post #39

Earlier quoted context omitted.

Wait, no, it's totally believable because this is the same story that happens over and over again with blockchains. It turns out that all of those pain in the ass compliance laws on traditional finance are there for a reason, and when you ignore the past you end up repeating it.

Most hacks are discovered within minutes or hours, not having the systems in place to know within seconds if your wallet is being drained is unbelievably bad for someone custodying half a billion.

> Most hacks are discovered within minutes or hours

Really? The figures I’ve seen have typically put it in days to weeks unless you’re talking only about the most obvious things like DoS attacks or defacing someone’s homepage.

Re: $625M worth of ETH drained on Axie Infinity's Ronin Network

#469

Post by _1tan »

uncletammy wrote: post #463
tenuousemphasis wrote: post #385

Earlier quoted context omitted.

It's not at all. The worst thing a centralized server can do in Lightning is refuse to route your transactions. Their peers have the keys and the pre-signed transactions necessary to unilaterally withdraw their funds from the channel.

> The worst thing a centralized server can do in Lightning is refuse to route your transactions. This is called censorship, the very thing Bitcoin was created to circumvent. It's an especially big problem given the fact that the vast majority of lightning payments are routed through lightning nodes operated by centralized cryptocurrency exchanges. Most of the remaining nodes on the lightning network are unreliable du…

It is certainly not a general instance of censorship if certain node operators or miners choose to exclude transactions meeting certain criteria.

This isn't comparable to e.g. a hard coded blacklist.

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