- WazirX recovered $3 million from a 2024 cryptocurrency heist.
- Following a security breach, attackers have yet to recover $231 million.
Reports say that a prominent Indian cryptocurrency exchange WazirX, in its endeavour, was allegedly able to bring back $3 million in the form of the stolen USDT till January 17. This was reportedly the first asset recovery that the company witnessed following its massive experience with the cyber-attack in July 2024. The said hack, as it reportedly happened in India, has come to emerge as one of the most giant crypto heists, hackers were withdrawing more than $234 million or ₹2000 crore from the Ethereum hot wallet of WazirX.
It happened in July 2024 when hackers stole unauthorized access to the wallet infrastructure of crypto custody provider Liminal Company which owns WazirX’s cryptos. Hackers leveraged a multi-signature protocol that required six signatures to authorize a transaction. Five of these signatures belonged to WazirX, while the last belonged to Liminal. They exploited gaps between the real transaction data and the interface presented by Liminal, rendering all the protections ineffective and gaining unauthorized access to the wallet. They siphoned nearly half of WazirX’s total assets.
A cyber attack shook the Indian crypto space with a wave of questions regarding how secure the digital asset platforms were. WazirX’s parent company, Zettai Pte Ltd sought a moratorium from the Singapore High Court in August 2024 to restructure liabilities and trace the siphoned funds.
A meager recovery in the magnitude of $3 million is considered a very important milestone for WazirX, but compared to the magnitude of the loss, it still cannot be considered critical. Still, most of the lost money remains outstanding, adding about $231 million to this piece. That creates a shadow over the future of this exchange.
Impact of WazirX Hack
The hack has also sparked renewed demands for tighter crypto regulations as well as more secure mechanisms on platforms. Experts say India’s nascent cryptocurrency market needs proper regulation to ensure the safety of its investors and prevent such incidents.
Ever since the hack, the crypto community has rallied behind WazirX with a series of industry initiatives. CoinDCX-the leading Indian crypto exchanges-have indicated a desire to buy WazirX to assist in the recovery process. Says Sumit Gupta, co-founder at CoinDCX, “My firm stands ready to assist the affected users, pending necessary court and creditor approvals.”.
In other developments, CoinSwitch, a major Indian exchange, launched a recovery program worth $70 million titled “CoinSwitch Cares.” This gave WazirX users a chance to estimate and recover losses while having the opportunity to earn additional rewards through the dedicated portal of the program.
This kind of solidarity in the Indian crypto ecosystem among players such as CoinDCX and CoinSwitch reflects how well these exchanges will cooperate with WazirX’s recovery from such a great loss inflicted upon its users due to this hack.
WazirX’s success in recovering most of the stolen assets testifies to the persistent efforts of the exchange to get back on track from the blow dealt by the attack. With cross-border investigations and many more funds still unrecovered, it becomes very difficult for the exchange to get back customer confidence and make a complete comeback.
As India gets closer to transparent regulations for cryptocurrencies, the WazirX example rings out across the industry calling for improved security measures and better risk management.
