Evaluating only Axie Infinity / Sky Mavis’s profile at its peak — without knowing the outcome — the model ranked Unit economics as the #1 likely cause. Documented cause: Security failure.
Key Events Timeline
FOUNDING
Sky Mavis founded in Vietnam by Trung Nguyen; Axie Infinity launched as Pokemon-inspired NFT game.
FUNDING
Raised $152M Series B led by a16z at $3B valuation; peak DAU reached 2.7M mostly from Philippines and Venezuela.
FRAUD EXPOSURE
Ronin Bridge hacked by North Korea's Lazarus Group; $625M stolen in ETH/USDC, undetected for 6 days.
SHUTDOWN
DAU collapsed from 2.7M to under 300K; SLP token down 99%; Sky Mavis laid off 21% of staff in January 2023.
Full Analysis
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Documented cause
Sky Mavis's Ronin Network, the Ethereum sidechain powering Axie Infinity, was hacked on March 23, 2022 by North Korean Lazarus Group, stealing $625M in ETH and USDC — the largest DeFi hack in history. The hack went undetected for 6 days. CEO Trung Nguyen had prioritized speed over security, running only 9 validator nodes. SLP token economics also collapsed as millions of Filipino and Venezuelan play-to-earn workers flooded supply. DAU fell from 2.7M to under 300K by year-end 2022.
Lesson
“Blockchain bridges are the weakest security link; never run critical infrastructure with 9 validator nodes.”