Binance has significantly reduced the size of its investment in Axie Infinity developer Sky Mavis.
In April, days after North Korean hackers stole $540 million in crypto from the sidechain that supports Axie Infinity, Binance rode to the rescue by announcing that it would lead a $150 million investment in Sky Mavis. The plan was to use the funds, alongside Sky Mavis’s own capital, to reimburse victims of the hack.
But Binance confirmed today that it is no longer the lead investor in the round.
“Since April, Sky Mavis has been able to both stabilise and recover funds. As a result, Sky Mavis is now in a position to cover users’ funds without significant investment from Binance,” said a Binance spokesperson. “To this end, Binance will no longer be the lead investor in Sky Mavis. Binance though will continue to support Sky Mavis.”
The company will invest an undisclosed sum in Sky Mavis while continuing to advise the startup, the spokesperson added. While the exact amount the exchange will invest is unclear, a person with knowledge of the matter said it is substantially less than the initial commitment.
Ronin, the Ethereum-linked sidechain that underpins Axie Infinity, was relaunched on June 28. A spokesperson for Sky Mavis said that all user funds had been restored by the time the bridge reopened.
“Sky Mavis is in a solid financial position with 150 employees and is still hiring,” said the Sky Mavis spokesperson. “All investors who committed to the round are still participating.”
Animoca Brands, a16z, Dialectic and Paradigm all participated in the April fundraise alongside Binance.
Last week, The Block revealed that the Ronin exploit was made possible after a senior engineer at Sky Mavis fell victim to a spear phishing attack in the form of a fake job offer.
One of the world’s largest play-to-earn crypto games, Axie Infinity boasted 2.7 million daily active users and $214 million in weekly trading volume for its in-game NFTs in November last year, but those numbers have plummeted recently.
© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.