Axion Back on Its Feet After Being Hacked by a Rogue Subcontractor

Ever since the invention of the internet, hackers have been going either after money, or after information that could bring them money.

Published November 26, 2020 Updated 6 months ago

Hacking attacks are hardly a new occurrence in the crypto industry.

Of course, most of the time, hacking attacks are targeting crypto exchanges, attempting to use user credentials to break into their accounts and empty them of money. However, when it comes to the crypto project Axion, its hacking attack came from the inside. It was not conducted by one of its own team members, but by a subcontractor who suddenly decided to rob the project out of all of its funds.

What Happened With Axion?

Throughout 2020, as the world kept fighting the COVID-19 pandemic and the lack of work, money, and the desire to go and socialize — the Axion team has been working hard on building its groundbreaking investment-grade cryptocurrency option.

The project has always been especially focused on security. This is why its team audited the code no less than five times before the launch of the project’s Mainnet. It even hired contractors to help with the development and security, and ensure that there are no flaws, bugs, or vulnerabilities of any kind.

Unfortunately, before random hackers could even get a chance to try their skill against the project’s defenses, Axion suffered an attack from one of its own contractors — RocknBlock developer known as Ilya Maximovich Solovyanov.

Solovyanov wrote a code that allowed him to leave a backdoor open, injecting it into the rest of the project’s work after the audits were completed. After Axion’s team, as well as several 3rd parties, confirmed that the code was flawless, Solovyanov purposefully implanted it, and after the project’s launch on November 2nd, he broke back in through the backdoor, robbing Axion out of $500,000.

Axion Recovers From The Attack

Now, for most projects, this would have meant the end. Axion, however, managed to get back to its feet thanks to the help of its community.

After revealing what has transpired, the project’s community came together and it managed to raise almost the exact amount that was stolen within only a few days.

In fact, the project managed to locate the flaw, remove it, and use the funds to relaunch only 11 days later, on November 13th,

Not only that, but it airdropped its new token to the community members’ wallets without any transaction fees. The amount corresponds to the state in the wallets as recorded prior to the crash, with the apology and a promise that the project will do right by each and every member of the community.

The project also had a lot of understanding for certain members of the community, including those who attempted to save what money they could after the hack, and even those who entered after the hack, believing that they could buy AXN at a bargain.

Axion Thrives After The Relaunch

Before long, Axion was back on its feet, and it came back even stronger than before. Furthermore, this experience, as unfortunate as it was, strengthened the bond between Axion and its crypto community.

The project even held its first weekly token auctions exactly one week after the relaunch, and it managed to raise around $8 million after selling slightly over 14 million units. According to its plans, 80% of the amount will be used for token buybacks, while the remaining 20% would go towards network development.

Furthermore, Axion also revealed plans to donate 1% of auction proceeds to Eden Reforestation Projects, and help save the environment by planting trees. The funds are being extracted from the 20% meant for the network development, as the 80% are used for token buybacks that create 8% yield for the project’s stakeholders.

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Ali Raza Ali is a journalist with extensive experience in content creation, including online journalism and marketing. He holds a master's degree in finance and enjoys writing about cryptocurrencies and FintTech. Ali's work has been published on a number of major financial publications.