Week in Review - A cocktail party and a $625M heist

Hello readers, and welcome back!

Last week, I wrote about the peculiarities of Grand Theft Auto’s increasingly complex economy. This week, I’m talking about a party I went to a few days ago.

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the big thing

About a week and a half ago, I grabbed a drink with an old TechCrunch colleague at a San Francisco party thrown by the studio behind crypto game Axie Infinity. The party boasted standard fare for a crypto get together, lots of dudes, lots of talk of NFTs and some dorky (but tasty) signature cocktails.

What’s more noteworthy about this event was what no one there was talking about.

Just one day before, a hacker breached the systems of Axie and absconded with $625 million of cryptocurrencies. No one at this party had any idea that this had happened, in fact it went undetected by the developers of Axie Infinity for six days.

Sophisticated heists are a frequent occurrence in the crypto world, a million here, ten million there. But last week’s Axie’s hack (specifically the Ronin network that underpins Axie’s economic engine) set a record as the largest DeFi hack ever.

There’s something a bit more problematic than usual with this one — beyond the outsized dollar sum.

“Play-to-earn” as an idea has been fairly controversial both outside and inside of the crypto community. Users in these games earn in-game currency for the efforts they put into the title’s mechanics, but it’s an in-game currency that can be converted into crypto. Proponents have claimed that this could be a new future for linking developing and developed nations’ online economies. Plenty of folks in South East Asian countries have been earning a living playing Axie over the past several months and billions of dollars have gone through the ecosystem in that time.

So the issue is that this is an empire made up not only of standard crypto speculators like the ones at the networking party I went to, it’s made up of an awful lot of people who are dependent on each and every day’s wages to survive. The idea that their livelihoods could be challenged by some code vulnerabilities should have given plenty in the crypto industry pause this week. The space is courting so much investor attention because it’s early and the opportunities appear massive, but leaving users — especially poorer users and less technical ones — as beta testers of this future feels dangerous.

Axie Infinity’s developers are searching for the cyber thieves behind this most recent heist, but there’s no sign of resolution for their network yet.

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other things

Here are a few stories this week I think you should take a closer look at:

Amazon fulfillment center votes to unionize
Amazon suffered its first loss this week in a bid to stave off unionizing efforts at the online retailer. Amazon’s Staten Island warehouse fulfillment center voted to unionize Friday with the formation of a union being approved: 2,654 to 2,131 votes.

Biden looks to boost US battery production
Gas prices are weighing on public perception of the Biden Administration and the White House is tapping the Defense Production Act to boost production of batteries for electric vehicles as a bid to reduce America’s dependency on foreign oil markets.

Gaming’s biggest conference gets canceled for 2022
In January, E3 announced that it would not be having an in-person conference in 2022. This week, the company announced that it will be canceling the digital element of the 2022 conference as well.

added things

Some of my favorite reads from our TechCrunch+ subscription service this week:

Our favorite startups from YC Demo Days Winter 2022
“We shook up our coverage this year, divvying things up by sector and geography. Our goal was to avoid a huge list, the sort that we compiled in years past…But one thing we’re not changing with our Y Combinator coverage is collecting favorites. Naturally, this is just our opinion. Our staff spends lots of time diving into the technologies that startups are building, the sectors they are focused on and the parts of the world they hope to serve. As a result, each of us has a distinct perspective. So, our favorites often stem from areas we know best and what we are currently fascinated by…”

3 things you can do to support Ukraine’s IT sector
“Since the war began, Ukrainian soldiers at the front line have requested tools and other hard-to-find items from their friends and colleagues around the country. ‘Our team coordinated scavenging garages, basements, and tool sheds, as most of these supplies are hard or impossible to find now in Ukraine,’…“

Is it time to start worrying about startup layoffs?
“It’s doubtful that accelerating staff reductions will make the startup labor market dramatically less talent-friendly. Startups are not the only companies in the market hiring technology workers. Upstart technology firms must compete with both industry incumbents, like Apple and Microsoft, for talent, as well as traditional firms building out their own in-house engineering and data teams. So it’s likely that even as startups trim staff, the labor market for tech workers remains more than temperate…”

• Director of Engineering, Mobile at Brivo Systems LLC (Bethesda, MD, USA)
• Jr Developer at Material (Century City, California )
• Data Scientist at Glassbeam Inc (Santa Clara, CA, USA)
• Software Architect at Moore Nanotechnology Systems (Swanzey, NH, USA)
• Xamarin Developer at Cardknox (Anywhere)

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