Mixin Network, a Web3 company, recently fell victim to a major cyberattack resulting in the theft of $200 million from its decentralized wallet service.
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The breach occurred over a weekend, prompting Mixin Network to collaborate with cybersecurity company SlowMist to investigate the incident.
Background
Mixin Network, established in 2017 with assets valued at one million dollars, offers an uncentralized wallet service. The company has officially acknowledged the breach, with founder Feng Xiaodong addressing the community via an online stream on September 24th.
The Hack
The hackers targeted Mixin Network's cloud platform, resulting in the loss of $200 million from the mainnet. Mixin Network released an official statement apologizing for the inconvenience caused by the breach.
Immediate Response
In response to the incident, Mixin Network temporarily halted all withdrawal and deposit services. The breach significantly impacted the platform's treasury, which was reported to have assets valued at just over $1.1 billion.
Market Impact
Following news of the hack, the XIN token associated with Mixin Network experienced an eight percent drop in value. Currently, XIN is trading at $194.
Historical Context
This incident is not the first time a blockchain-based firm's central server has been targeted by cybercriminals. A study by blockchain research firm CertiK in 2000 highlighted the risks associated with centralization in the decentralized finance (DeFi) sector.
Security Concerns
Researchers have pointed out that DeFi and similar sectors must prioritize security as more work shifts towards blockchain-based networks.
The report also mentions that the total amount stolen from hacks, crypto scams, and rug pulls exceeded $656 million in the first quarter of 2023, according to a study by Web 3.0 security provider Beosin.
Mixin Network's $200 million breach highlights the ongoing security challenges faced by Web3 and blockchain-based companies. As the crypto sector continues to grow, cybersecurity remains a critical concern for the industry.
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