Cryptocurrency Casino MetaWin Hacked, $4M Vanishes

MetaWin is an online gaming platform offering interactive slots, live dealer table games like blackjack, roulette, poker, and baccarat, nonfungible token (NFT) raffles and drawings, and a variety of instant-win games.

An online casino that accepts cryptocurrency was hacked this week, the company’s CEO has admitted.

MetaWin offers interactive slots, live dealer table games including blackjack, roulette, poker, and baccarat, nonfungible token (NFT) raffles and drawings, and a variety of instant-win games.

The MetaWin rewards program also qualifies players for daily and weekly “wagering races” where bettors are ranked based on the total number of real money bets they make. The races qualify players for a shot at winning a weekly top prize of $40K.

The London-based online casino operates offshore through an internet gaming license issued from Anjouan, a small archipelagic country located off the southeastern coast of Africa. MetaWin isn’t licensed to take bets in any US state, though players who play the online casino have little chance of facing legal consequences.

State gaming regulators, however, continue to caution consumers about the risks of using an offshore casino. They say unlicensed gaming sites provide few to no consumer protections, including that their online funds are secure. That point was proven this week through the MetaWin hack.

$4M Stolen

Richard Skelhorn, the founder and CEO of MetaWin, confirmed on November 3 that some MetaWin “hot wallets” were hacked. Skelhorn’s comments came after blockchain investigator ZachXBT shared on his Telegram channel about a successful exploit of MetaWin’s Ethereum and Solana hot wallets.

“Today, we experienced an attack where an exploiter was able to withdraw a significant amount from our hot wallets by taking advantage of our frictionless withdrawal system,” Skel wrote. “We’ll be implementing additional security controls for new users, while also exploring ways to maintain a flexible and seamless experience for our trusted community.”

Hot wallets are cryptocurrency wallets that are constantly connected to the internet. Hot wallets are used as temporary key storage and to send and receive cryptocurrency.

Cold wallets, or storages, that keep crypto offline in an offline private setting, are considered the safest method for securing digital currency. But hot wallets are needed to transact coins like Bitcoin, Ethereum, Tether, and Solana.

ZachXBT said the hackers managed to take off with $4 million in cryptocurrency, which was swiftly transferred to KuCoin and a HitBTC nested cold wallet. The online sleuth detected that more than 115 addresses were associated with the malicious actor.

To his credit, Skel said he would singlehandedly cover the $4 million loss and had already begun “topping off” impacted customers.

“In short, today we faced a challenge, but we’re learning from it and will emerge stronger,” Skel concluded.

Master Marketer

Skelhorn made much of his fortune by founding the Atemi Group in 2015. The company specialized in global iGaming lead generation and social media advertising.

Skelhorn sold his Atemi Group in 2020 to Better Collective for €44 million (US$48 million). During the year Atemi was bought, the company sent more than 180K new depositing customers to its global iGaming and online sportsbook partners.

Better Collective is a publicly traded firm based in Denmark that owns The Action Network, SportsHandle, and VegasInsider online media brands.