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Mixin Network, a decentralized cross-chain protocol, has communicated with the hacker responsible for the $200 million exploit on September 23, offering a $20 million bug bounty in exchange for the return of the remaining assets.
The message from Mixin Network was encrypted alongside the exploiter’s transaction, urging the hacker to return the funds since the majority of the stolen assets belonged to users.
“Most of our platform assets were users, and we hope you can refund them. You can keep $20M of the assets as a BUG Bounty Reward for the BUG.”
Mixin Network confirmed the incident on September 25, stating that the exploiters had successfully compromised a third-party cloud service provider, leading to the theft of nearly $200 million in assets from the platform.
[Announcement] In the early morning of September 23, 2023 Hong Kong time, the database of Mixin Network’s cloud service provider was attacked by hackers, resulting in the loss of some assets on the mainnet. We have contacted Google and blockchain security company @SlowMist_Team…
— Mixin Kernel (@MixinKernel) September 25, 2023
Feng Xiaodong, the founder of Mixin, mentioned at that time that the company would compensate affected users up to a “maximum of 50%,” with the remaining amount being returned in bond tokens that the company would subsequently repurchase using its earnings.
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Mixin has not yet provided comprehensive details regarding the circumstances that led to the exploit, but an on-chain analytics platform has pointed out a history of interactions between the hacker and Mixin Network. The hacker-associated address 0x1795 received 5 Ether (ETH) from Mixin in 2022.
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Although the exact method by which the exploiters managed to steal $200 million worth of assets through a data breach remains unclear, cross-chain protocols within the decentralized finance (DeFi) sector have been the target of some of the most significant exploits in crypto history. One report suggests that over half of all DeFi exploits occur on cross-chain protocols, resulting in losses exceeding $2.5 billion.
Bridge exploits account for more than 50% of DeFi losses. Source: Token Terminal
Cross-chain protocols facilitate interoperability among different blockchains, enabling users to transfer assets from one blockchain to another. Consequently, these cross-chain protocols often manage a substantial amount of assets from various chains, rendering them susceptible to such exploits.
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