WazirX, one of India’s leading cryptocurrency exchanges, recently made headlines when it announced the suspension of all trading activities on its platform. This decision came just days after the exchange suffered a devastating security breach that resulted in the loss of approximately $230 million, almost half of its reserves.
The Mumbai-based exchange took to Twitter to inform its users about the cyber attack and the subsequent suspension of customer withdrawals. The attacker had managed to gain access to one of WazirX’s multi-signature wallets, which stored crypto assets worth hundreds of millions of dollars. What’s particularly concerning is that five out of the six signatories responsible for protecting the impacted wallet were members of the WazirX team.
According to WazirX, the cyber attack was the result of a discrepancy between the data displayed on Liminal’s interface and the actual contents of the transaction. This raises questions about the adequacy of WazirX’s reserves and its ability to fully reimburse its customers.
In an effort to recover the stolen assets, WazirX announced a bounty program with a reward of up to $23 million. The exchange is hoping that someone will come forward with information that can help them trace and retrieve the missing funds. Interestingly, risk-management platform Elliptic conducted an analysis and found that the attacker has links to North Korea, adding another layer of complexity to the situation.
The loss of $230 million is a significant blow to WazirX, especially considering that the exchange reported holdings of around $500 million in its June proof-of-reserves disclosure. To describe the security breach as a “force majeure event” indicates the severity of the situation and highlights the challenging road ahead for WazirX as it navigates this crisis.
While WazirX grapples with the aftermath of the attack, other Indian exchanges that work with WazirX, such as CoinSwitch and CoinDCX, have assured their customers that they have not been impacted by the breach. This news provides some relief to users who may be concerned about the safety of their assets on these platforms.
In conclusion, the security breach and subsequent suspension of trading activities on WazirX have raised serious concerns about the exchange’s ability to protect its customers’ funds. The loss of $230 million is a significant setback, and WazirX’s response to this incident will be crucial in determining its future credibility and trustworthiness in the cryptocurrency market. As the investigation continues and more details emerge, it is essential for users to exercise caution and consider alternative platforms for their trading needs.
