FBI seizure of over NOK 300 million – Norwegian Aleksander’s company still lacks billions

– It has been a very big mental strain to be in it. You wake up one day and your entire life’s work is in jeopardy.

That’s what Aleksander Leonard Larsen from the island of Tromsø says to NRK.

Larsen is one of five founders of the company Sky Mavis, where he is currently operations manager.

In March, it became known that Sky Mavis’s crypto game, Axie Infinity, had been subjected to a large-scale theft, where hackers had stolen almost NOK 5.6 billion in cryptocurrency.

750 Norwegian customers had accounts in the game when the attack occurred, and Økokrim assumed in May that these Norwegian accounts had between NOK 40 and 50 million at their disposal.

The robbery is referred to as the “biggest crypto-theft” of all time.

– It is quite brutal for the company to have so much money the day before that we can do exactly what we want – only to not know the day after whether the company is still going, he says.

Larsen now confirms to NRK that the FBI has seized 30 million US dollars, which at today’s dollar exchange rate means just under 310 million Norwegian kroner.

The entire Sky Mavis management team gathered in Norway last week. Here is operations manager Aleksander Leonard Larsen together with managing director Trung Nguyen (in the middle) and technical director Viet Anh Ho.

Photo: Marius Christensen / NRK

Today, Larsen has an ownership of around 4.7 per cent in the company, which in October last year should have corresponded to a value of NOK 1.3 billion.

Ecocrime: – Current threat

The crypto theft at Sky Mavis is still a priority investigation at Økokrim.

They work closely with the FBI in the tracking of dividends, and say they will continue this active tracking in the future.

– Økokrim’s team follows the money laundering operation daily and does everything possible to stop and identify those behind it the money launderingsays first state prosecutor in Økokrim, Marianne Bender, to NRK.

First state prosecutor in Økokrim Marianne Bender says that the perpetrators are running a large-scale money laundering operation.

Photo: Kai Rune Kvitstein / NRK

In April, the FBI reported that hackers from the North Korean groups Lazarus and APT38 were behind the theft.

Økokrim still refers to the hacking as a “current threat” on its own website, and the call to contact Økokrim is still the first thing that comes up on the organisation’s website.

That over four months after the hacking became known.

CRYPTOS GAMES: Several hundred Norwegian users may have had valuables worth many millions of kroner stolen after malicious hackers attacked a network associated with the game Axie Infinity.

Photo: Gunnar Bratthammer / NRK

– The perpetrators run a large-scale money laundering operation of the 5 billion that was stolen, where they try to hide the profits they launder, but also to take profits in the physical world, says Bender.

Took the cost to the customers

Sky Mavis chose to refund the lost money to its customers soon after the hack. This is money they consider lost.

– We chose to do that out of free will, because it gave us the greatest chance of further success. We are very dependent on the trust of our players. Nevertheless, it was hard to see the number we were guilty of increasing from day to day. It worked out, but only just. It was “the save of a lifetime”, says Larsen with a smile.

– We have really thought all along that the money will not come back – at least not at first. We see everything that we get back as a bonus.


What is cryptocurrency?

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Cryptocurrency is digital currency

The money can only be found on the internet. Therefore, wherever you are in the world, you can settle in one digital currency without intermediaries.

Cryptocurrency is not controlled by banks

Cryptocurrency is decentralized and encrypted. In theory, no one controls it. This often means that the exchange rate for this type of currency is extremely unstable. It can therefore increase the possibility of achieving a higher return on your investment, but also the risk of you losing big.

What is blockchain?

The reason why “nobody” controls cryptocurrency is the technology it uses, which is called “blockchain”. The blockchain is a form of a database, where the data is not stored only in one place, but with everyone in the network. The technology allows the participants in the network to approve transactions without the consent of a third party.

There are thousands of different cryptocurrencies

Some of the biggest ones are Bitcoin, Ethereum, Litecoin and Ripple. The currency is bought on so-called crypto exchanges, of which there are gradually starting to be quite a few.

What is it used for?

Cryptocurrency is used to a greater extent as an investment object, and object of speculation, than means of payment which was the original purpose.

Creating more coins (units of the currency) is called mining

Mining is the process by which “blocks” of transactions are verified, and new units launched. If you have “mined” or extracted virtual currency such as bitcoin, you must report it in your tax return.

The process requires enormous amounts of computing power

If bitcoin were a country, it would rank 58th in the world in terms of power consumption. To mine bitcoin, thousands of powerful computers are used. This has led to a lot of climate criticism because much of the extraction uses coal power as an energy source, the most harmful type of fossil energy for the climate.

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They could pay the money back to customers after a particularly successful 2021. Their Axie Infinity game alone brought in over NOK 11 billion that year.

Photo: Lise Åserud / NTB

– I am very proud that we managed to get through this. These are such large sums, so it was undoubtedly life-threatening for the company. That we will sit today on the other side with so many employees and players is really unheard of.

Launched new collaboration

Today, the company has 185 employees. They have a head office in Vietnam, but also some smaller offices in Norway, San Francisco and Germany. One of their games had 2.7 million daily users before the company chose to replace it with a new game coming in a few weeks.

Of course, it also helps that the FBI has now seized a large proportion of the proceeds of the robbery.

– It is wonderful to see that the wind is beginning to turn. $30 million is a lot. Everything helps, says Larsen.

And the wind has really started to turn for the company. Earlier in September, they announced, among other things, that they have started a collaboration with Google. After the break-in, the company felt compelled to strengthen security in “all possible ways”.

– We became close partners with Google last year, but things have taken time. The fact that we have now been approved by one of the largest companies in the world sends an important signal to the world that we are on our way back.

In the future, Sky Mavis must learn to live with the risk that criminals will make life difficult for them, Larsen believes.

– Sometimes I find it difficult to relax. It is difficult to be completely sure, but we try to cover all the hatches. This industry is so new that there is a lot of risk no matter what you do. We have to accept that.

The article is in Norwegian

Tags: FBI seizure NOK million Norwegian Aleksanders company lacks billions

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