India's Premier Crypto Exchange WazirX Compromised in $235M Theft

India's largest crypto exchange, WazirX, has been hacked for $235 million, leading to suspended withdrawals and significant market value drops for all involved cryptocurrencies.

Security Breach and Initial Report

India’s largest crypto exchange, WazirX, suffered a significant security breach on Thursday. Web3 security firm Cyvers initially reported the attack, alerting WazirX that its Safe wallet had been compromised by a malicious actor. 

Cyvers announced on X.com, 

"Hey WazirX, our system has detected multiple suspicious transactions involving your Safe Multisig wallet on the ETH network. A total of $234.9M of your funds have been moved to a new address. Each transaction's caller is funded by Tornado Cash." 

The tweet also indicated that Cyvers had attempted to contact WazirX directly but received no response.

Details of the Attack

According to the report, $234.9 million worth of funds from WazirX’s Safe Multisig wallet were transferred to a new address. These transactions were facilitated using Tornado Cash, a decentralized protocol designed for private transactions. The stolen assets, including Tether (USDT), Pepe (PEPE), and Gala (GALA), were converted into Ether (ETH).

Further Investigation Findings

Crypto investigator ZachXBT further examined the incident, revealing on Telegram that the primary attacker’s address still holds over $104 million. The compromised wallet contained around $100 million in Shiba Inu (SHIB), $52 million in ETH, and $11 million in Polygon (MATIC). Additionally, it held $4.7 million in FLOKI, $3.2 million in Fantom (FTM), $2.8 million in Chainlink (LINK), $2.3 million in Fetch.ai (FET), and smaller amounts of various other tokens.

WazirX's Response

WazirX confirmed the breach on X.com, announcing that an active investigation was underway. The exchange stated, 

"To ensure the safety of your assets, INR and crypto withdrawals will be temporarily paused. Thank you for your patience and understanding. We'll keep you posted with further updates."

However, the team did not comment on the safety of user funds or the measures being taken to recover the stolen assets.

Market Impact

The hack has severely impacted WazirX’s reserves and the market value of the affected cryptocurrencies. WazirX’s native token, WRX, has dropped 15%, now trading at just over 14 cents. Due to the hacker liquidating the coins, SHIB has lost over 6% in market value in U.S. dollar terms and is trading 16% lower in rupee terms. The bitcoin-rupee (BTC/INR) pair has declined by 11% to $60,945, reflecting panic selling and a rush for fiat/cash following the attack.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.