XIN Falls As Mixin Network Sees Record-Breaking Hack

Popular Asia-focused blockchain Mixin Network suffers massive hack linked to centralized database provider.

In what is evidently the biggest crypto hack this year so far, Mixin Network has confirmed a security breach with approximately $200 million in assets stolen.

Mixin Network is popular within the Asian crypto space, labeling itself a “free, lightning fast & decentralized network for transferring digital assets.” The network also supports the creation of decentralized applications and allows cheap and near-instant transfers.

Mixin reported Monday that its cloud-based service provider was hacked on September 23. This exploit led to the loss of a significant amount of assets on the mainnet.

The project has temporarily suspended deposits and withdrawals and also contacted Google and blockchain security company SlowMist to assist with investigations.

Mixin Network will resume deposits and withdrawals after confirming and fixing the vulnerabilities, although transfers on the network are currently not impacted by the hack.

According to the Mixin Network team’s update, deliberations remain ongoing on how to deal with the lost assets. However, the project pledged to do its best to “minimize the losses” for users in the wake of the incident.

[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

The Mixin Network hack now tops the list of cryptocurrency-related hacks since the turn of the year.

Until now, Euler Finance’s $197 million hack in March topped the leaderboard for crypto hacks in 2023. Other recent hacks include CoinEX’s $54 million loss and Curve Finance’s $47 million incident. 

Mixin Hack Linked to Centralization Risks

Mixin’s preliminary report on the incident and its allusion to a breach on its “cloud-based service provider” suggests that the hack is linked to storing its private keys on a centralized server.

Such an approach evidently undermines the ethos that underpins public blockchain networks, as the crypto community on X (formerly Twitter) was quick to point out following the hack.

Meanwhile, the Mixin Network security breach has expectedly impacted the price of the project’s native token, XIN. Following the Sept. 23 incident, XIN’s price has dropped 11%, according to data on Coingecko.

Similarly, Mixin Explorer shows that the total value of assets locked (TVL) on the network has dropped in the past 48 hours. The DeFi-centric metric declined from over $1.04 billion before the hack to $900 million at the time of writing.