Crypto hit by US$63 million hack of ‘Munchables’ game in one of year’s biggest exploits

THE crypto sector suffered one of its biggest security incidents this year after a hacker swiped US$63 million from a blockchain-based game.

The game, Munchables, confirmed the incident in a post on X on Wednesday (Mar 27) and said it would try to halt the transactions.

Blockchain specialists PeckShield indicated the hacker stole 17,400 in Ether tokens – worth about US$63 million at current prices. Public data on crypto transactions backed the estimate.

The exploiter appears to have had a change of heart, however, and returned the funds in full later the same day, according to blockchain data. Munchables declared “all user funds are safe,” in a post on X at around 2.30 pm Singapore time, adding in a separate post that the hacker had not insisted on any conditions.

Munchables is built on Blast, a so-called Layer two that promises more efficient transactions than established blockchains as well as airline-like loyalty points.

Blast’s founder, Tieshun Roquerre, who goes by the pseudonym Pacman, hailed the “incredible lift” required to secure Munchables’ funds after today’s exploit, in a post on X at 2.20 pm Singapore time. He added that “the ex Munchables dev opted to return all funds in the end without any ransom required.”

Gamers in Munchables try to earn rewards by looking after, or farming, bug-eyed digital creatures. Earlier this week the project said the value of crypto tokens held in the protocol had topped US$80 million.

The security incident triggered a flurry of unsubstantiated speculation that a rogue developer or even North Korean hackers were to blame.

The number of North Korean-linked hacks of crypto platforms hit a record high in 2023, though the actual amount of funds stolen – slightly more than US$1 billion – dropped around 40 per cent, based on data from blockchain sleuths Chainalysis.

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The Lazarus Group, a North Korean hacking unit, infamously stole around US$600 million from the blockchain underpinning Axie Infinity, once one of the sector’s most popular games.

Security exploits overall cost the digital-asset industry about US$1.8 billion last year, down around 50 per cent from 2022, according to Immunefi, a platform offering bounties to researchers who spot security flaws in crypto software. BLOOMBERG