WazirX in Turmoil: How $230 Million Vanished Overnight!

Indian cryptocurrency exchange WazirX confirmed a significant security breach on Thursday, revealing that approximately $234.9 million worth of assets were suspiciously transferred out of the platform. The breach, detected earlier in the day, has prompted the Mumbai-based firm to temporarily pause all withdrawals.

Details of the Breach

The breach involved one of WazirX’s multisig wallets—wallets that require multiple signatures for transactions. “We’re aware that one of our multisig wallets has experienced a security breach,” WazirX communicated via Twitter. This incident led to the unauthorized transfer of a substantial amount of various cryptocurrencies, including 5.43 billion SHIB tokens, over 15,200 Ethereum tokens, 20.5 million Matic tokens, 640 billion Pepe tokens, 5.79 million USDT, and 135 million Gala tokens, as reported by Lookchain, a third-party blockchain explorer.

Blockchain data indicates that the attacker is attempting to offload the stolen assets using the decentralized exchange Uniswap. The loss of $234.9 million is particularly significant given that WazirX had reported about $500 million in assets in its June proof-of-reserves disclosure. This breach represents nearly half of the firm’s declared reserves, underscoring the severity of the security lapse.

In the wake of this breach, other prominent Indian crypto exchanges like CoinSwitch and CoinDCX have moved quickly to reassure their users. Both exchanges have confirmed that their operations and user funds remain secure and unaffected by the incident at WazirX.

CoinDCX’s co-founder and chief executive, Sumit Gupta, emphasized the robustness of their wallet security in a tweet. Similarly, Ashish Singhal, co-founder and chief executive of PeepalCo, the holding firm of CoinSwitch, advised crypto investors to remain cautious and be mindful of potential market volatility during this turbulent period.

This breach is the latest in a series of challenges for WazirX, which had separated from Binance in early 2023 following a public and high-profile fallout in 2022. The discord began two years after Binance announced its acquisition of WazirX, leading to disputes over the ownership of the Indian firm. The disagreement culminated with Binance founder Changpeng Zhao declaring that the deal had not concluded and subsequently moving to sever ties with WazirX.

The breach not only highlights significant security concerns within the crypto exchange but also casts a shadow over the broader reliability of cryptocurrency platforms in safeguarding user assets.