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Ronin Bridge Hack May Change the Future of VC Investment in Crypto
Ronin Bridge Hack May Change the Future of VC Investment in Crypto
- Ethereum-based sidechain Ronin was hacked earlier this week.
- This hack could change how VCs invest in crypto.
- Auditing the code and security protocols before investing is necessary, says Yat Siu.
On Tuesday, the Ethereum-based sidechain Ronin became prey to a massive hack. Ronin was created by Sky Mavis for the popular Play-to-Earn game Axie Infinity. The company disclosed details of the $625 million worth theft during co-founder Jeff Zirlin’s keynote address at the NFT LA conference.
Yat Siu, Co-founder of popular game software company Animoca Brands, was another member who attended the NFT LA conference. Animoca Brands has a growing portfolio of more than 150 investments in NFT-related companies and decentralized projects including Axie Infinity.
In an interview he gave at the conference, Siu talked about the hack, saying that this event would likely change the attitude and responsibilities of venture capitalists investing in crypto. “It’s a shame that maybe this needed to happen to Sky Mavis for the world to take note, but we’re all being more careful.”
Siu continued to add that VC firms investing in crypto should be prepared to help companies in case of a hack. He also talked about the importance of closely auditing the code and security protocols before investing. Moreover, the Hong-Kong based entrepreneur stated that VCs could work with blockchain-focused security firms, such as CertiK, to make these assessments.
Crypto-native’ VC firms that have built all or part of their operations around knowledge of the industry have an advantage in terms of supporting portfolio companies on issues like security.
VCs in the crypto world have always been a controversial subject. Over the years, many crypto investors have voiced their displeasure at VCs saying that they yield too much control over the industry. It is interesting to note that Siu also went on to say that investors should be wary of projects where venture capitalists own a majority share of the tokens.
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