Hong Kong's Mixin Network Faces Controversy Over $200 Million Security Breach
Summary:
The Hong Kong-based Mixin Network faced controversy after disclosing a $200 million hack on Sept. 25. Bitcoin mining pool CEO, Zhuoer Jiang, claimed that Bitcoin stored in the Mixin protocol should have remained secure in offline storage. After a breach on Mixin’s cloud service provider's database, $200 million assets were lost on the Mixin's primary network, resulting in the suspension of deposits and withdrawal services. Founder of Mixin, Xiaodong Feng announced that Bitcoin was the main asset stolen and users would be compensated up to 50% through tokenized liability claims which Mixin plans to repurchase with future profits.
The Mixin Network, a cross-chain transfer protocol centered in Hong Kong, has become embroiled in contentious discussions following revelations of a $200 million breach on September 25th. Zhuoer Jiang, the head of the BTC.TOP Bitcoin mining pool, proclaimed on the same date that the Bitcoin held within the Mixin protocol should never have been vulnerable to theft. Jiang asserted the Bitcoin should have been securely held offline ("in cold storage"), thereby remaining safe from the breach that encroached on Mixin's online ("hot") wallets. As of its latest monthly report in July, Mixin housed about 9,544 BTC, equating to an approximate value of $253 million.
On September 23rd, hackers breached the database of Mixin's cloud service provider, leading to a $200 million asset loss on its primary network. Subsequently, all deposit and withdrawal activities were forthwith put on hold in the protocol, whilst the inquiry proceeds. However, it was clarified by the development team that transfer services would continue unaffected.
During a live update on September 25th, Xiaodong Feng, the originator of Mixin, revealed that Bitcoin was the chief asset looted in the $200 million security transgression, with developers vowing to remunerate users for up to half of the purloined assets. Feng noted that the remaining deficit would be styled into "tokenized liability claims" that Mixin intends to buy back using future earnings.
Established in 2017, Mixin had a near total of $400 million spread across 48 chains held within its protocol prior to the breach, according to DeFiLlama's data. The protocol enables users to transmit digital property to others using phone numbers. Xiaolai Li, a billionaire from China and a Bitcoin pioneer, is amongst its foundational angel investors.
Early on September 23, 2023 (Hong Kong time), Mixin Network's cloud service provider's database fell victim to a hacker attack, leading to the loss of certain assets on the primary network. Partnerships with Google and blockchain security firm @SlowMist_team have been forged in response to the incident...- Mixin Kernel (@MixinKernel) September 25, 2023
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Published At
9/25/2023 4:12:31 PM
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