BSP Warns Public on GameFi Platform Risks After $600M Axie Ronin Hack

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“We wish to emphasize that there are risks associated with non-fungible tokens (NFTs) such as price volatility, which may resort to significant financial losses and also other types of risk relating to cyber fraud and scams,” – Benjamin E. Diokno, BSP Governor 

Following the recent hacking incident of blockchain game Axie Infinity, the Bangko Sentral ng Pilipinas (BSP) has again warned the public as it flagged the risks of non-fungible tokens (NFTs) during a virtual press briefing last March 31. The central bank reminded the public to remain cautious when dealing with GameFi (gaming-finance) projects involving digital tokens.

“We have been reminding the public that they should be aware of how these games work, the risks attended to them, and they should, for example, know how they can have recourse or remedies,” – Bridget Rose Mesina-Romero, BSP Payment System Oversight Department Deputy Director 

She also emphasized that investors must take strict caution over blockchain games, noting the risks that come with such instruments.

“They should only place funds that they are willing to lose because of the risks,” she continued.

Furthermore, Diokno mentioned that the BSP is still continuously monitoring NFT activities that are used in online games, adding they are still discussing with other regulators the appropriate approach for Axie Infinity and other gaming platforms. According to BSP’s last update about Axie Infinity last November, they stated that its operator of payment systems (OPS) status is still under review.

On March 29, Sky Mavis halted the operations of Axie Infinity’s sidechain Ronin bridge and decentralized exchange Katana have after discovering an exploit for 173,600 Ethereum (ETH) and 25.5 million USD Coin (USDC) which are worth a combined $625 million. (Read more: Axie Infinity Ronin Network Hack | Money Has Been Transferred to Binance, FTX, Crypto.com)

Although the Ronin bridge and the decentralized exchange funds have been compromised, Axie Infinity assures that the Axies, the NFT pets of the game, have not been affected, nor have the Smooth Love Potion (SLP) and Axie Infinity Shards (AXS), Axie Infinity’s in-game cryptocurrencies.

Further, the stolen funds were also tracked and still in the hackers’ multiple accounts in crypto wallets Crypto.com, Huobi, FTX, and Binance.

In a BitPinas exclusive, Lorne Lantz of tracking tool Breadcrumbs shared how the stolen funds move and what the hacker did to exploit the Ronin Network. (Read more: Tracking the Stolen Funds from Ronin Network Using Breadcrumbs)

On the other hand, due to the hacking incident, the launch of Axie Infinity: Origin, the game’s free-to-play version, will be moved next week. Instead of launching on March 31 as planned, Sky Mavis unveiled a full schedule of leaks and events planned over the next seven days, as well as the culminating event for the alpha launch of Axie Infinity: Origin on April 7. (Read more: Axie Infinity Origin Launch Week Starts, Game Launches on April 7)

This article is published on BitPinas: BSP Warns Public on GameFi Platform Risks After $600M Axie Ronin Hack

Disclaimer: BitPinas articles and its external content are not financial advice. The team serves to deliver independent, unbiased news to provide information for Philippine-crypto and beyond.

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