Indian cryptocurrency exchange WazirX faced a major security breach recently, resulting in the loss of user funds totaling over $230 million. The breach occurred in one of the exchange’s multisig wallets, prompting WazirX to temporarily halt withdrawals and investigate the incident.
According to reports, the exploiters behind the attack have been actively selling the stolen tokens, which include $100 million worth of shiba inu and $52 million in ether, on the on-chain exchange Uniswap. This marks a significant portion of the exchange’s total reserves, as disclosed in a June 2024 report.
Blockchain analytics firm Elliptic has attributed the attack to hackers linked to North Korea. The stolen funds represent more than 45% of WazirX’s $500 million holdings, underscoring the severity of the breach.
In response to the breach, WazirX identified the multisig wallet provider as crypto custody firm Liminal, although Liminal clarified that the compromised wallets were created outside of its ecosystem. This incident highlights the importance of robust security measures in the cryptocurrency space, especially when handling significant amounts of digital assets.
The Indian Financial Ministry has refrained from commenting on the attack and its potential implications for the country’s crypto landscape. However, the breach raises concerns about the security of cryptocurrency exchanges operating in India and the need for enhanced regulatory oversight to protect investors.
Transaction data indicates that the exploiters are actively liquidating the stolen holdings on Uniswap, with significant amounts of shiba inu, ether, Matic, and pepe tokens being sold. Despite these developments, the perpetrators have not yet sold their ether holdings and continue to hold a substantial amount in FLOKI tokens.
WazirX, a popular platform among Indian traders, caters primarily to the local market and is registered with the Financial Intelligence Unit (FIU) to provide crypto exchange services in India. The exchange facilitates trading in various cryptocurrencies, with recent data showing significant trading volumes, particularly in tether (USDT) stablecoins and XRP.
As the investigation into the security breach continues, stakeholders in the cryptocurrency industry are closely monitoring the situation for further developments. The incident serves as a reminder of the risks associated with digital asset storage and the importance of implementing stringent security protocols to safeguard user funds in the evolving crypto landscape.