$200 Million In Crypto Lost As Mixin Network Comes Under Attack

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Decentralized finance peer-to-peer service Mixin network, experienced an attack on Saturday, September 23, 2023, leading to $200 million worth of crypto funds lost as a result of the attack.

$200 Million In Crypto Lost In The Attack

The decentralized finance (DeFi) network Mixin network revealed that the attack was caused by a compromise in the network’s cloud service provider database. The attack reportedly led to a loss of approximately $200 million worth of crypto funds stolen from its mainnet.

Blockchain security platform Peckshield conducted a separate investigation and it was revealed that Mixin network’s total portfolio accounted for approximately $141 million as at the time of the attack.

According to the announcement made by the Mixin team on X on Sunday, September 24, 2023, the attack happened during the early hours of September 23, 2023, Hong Kong time. The Mixin network immediately suspended deposits and withdrawals to prevent more losses.

However, the Mixin team has assured its users that these services are expected to resume once all vulnerabilities are thoroughly checked and fixed, but in the meantime, transfers are not affected during the period of suspension.

In addition, the Mixin team stated that once these vulnerabilities are determined, an announcement will be made later concerning a solution for handling the lost funds. 

The Mixin team stated that the exchange’s founder Feng Xiaodong will throw more light on the alleged attack on September 25, 2023, in a public Mandarin live stream at 13:00 Hong Kong Time, of which an English version is also expected to come afterwards to cover a wider audience.

So far, the exchange has contacted Google and blockchain security company Slowmist to aid in the investigation of the attack. SlowMist also took to X to announce its assistance in the investigation of the attack following a security alert post on September 24, 2023.

Mixin is a decentralized network service that offers a high-speed peer-to-peer transactional network for digital assets, which enables other blockchain ledgers to gain high transactions in seconds, and faster transaction confirmations, with low transaction fees. 

However, it is believed that Mixin which is a decentralized network depended on a centralized database for its network and that led to its vulnerabilities.

Mixin Founder Throws More Light On The Attack

As promised by the Mixin team that its founder would throw more light on the alleged attack on September 25, 2023, in a Mandarin live stream at 13:00 HKT, the exchange kept its word.

During the live stream, Mixin founder Feng Xiaodong stated that the exchange can only guarantee the safety of half of its user’s assets from the affected $200 million worth of crypto assets.

“No matter what your assets are — whether it’s Bitcoin or Ethereum — we will ensure that half of it is unaffected, We are trying to find a way to recover the compromised money, but that is very difficult,” Feng stated.

However, for the other half of the funds, Feng added that the Mixin team will issue “bond tokens” for its users to claim which the exchange intends to buy these tokens back from its users in the future. This way, the users get back their funds.

Nevertheless, the exchange has promised to establish a new system to host user’s assets with enhanced security measures.

Crypto total market cap chart from Tradingview.com (Mixin network)

Total market cap declines to $1.019 trillion | Source: Crypto Total Market Cap on Tradingview.com

Featured image from AIBC Summit, chart from Tradingview.com

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