India’s largest exchange WazirX has been probed by Indian authorities over the hack that led to the loss of $235 million in customer funds on their platform.
The hack that occurred on July 18 saw $235 million worth of crypto assets wiped off the exchange by a bad actor who has since been laundering the proceeds of the hack through Tornado Mixer.
WazirX at the moment is collaborating with India’s Financial Intelligence Unit and other agencies as they probe the platform for a possibility of insider involvement in the hack.
The exchange is collaborating by providing the Indian authorities with Server logs, transaction trails, and blockchain addresses related to the hack. No physical asset from WazirX has been seized so far as the platform continues to engage in multiple sessions with India’s financial intelligence unit and other agencies.
The FIU has additionally reached out to other stakeholders and players in the crypto industry to assess the reputational damage done by the major hack on WazirX. They seek to address concerns about the unregulated nature of the industry and how that impacts the confidence of retail investors.
WazirX Transparency Approach
WazirX has made plans to be as transparent as possible in their handling of the entire process which will see WazirX users receive 52–55% of their assets back.
The WazirX team is planning to publicly disclose wallet addresses through court affidavits and transparently respond to user queries. The exchange also aims to form a 10-member committee of creditors by Oct. 9 to guide its restructuring efforts.
WazirX’s parent company Zettai is also fully involved in the restructuring process and is fleshing out strategies that will ensure a mitigated loss for both platform and clients.
Zettai has reportedly started discussions with over 11 partners to initiate an efficient restructuring plan with involves profit profit-sharing strategy.
What to Know
- WazirX before its hack is the biggest crypto exchange in India in terms of transaction volume and customer base.
- WazirX incurred a $235 million loss from the July 18 cyber-attack, which angered its community which has accused the platform on insider involvement.
- The Hack severely impacted the exchange and led it to seek a Scheme of Arrangement in Singapore, a restructuring process under local insolvency laws
- An independent audit by an analytics firm Grant Thornton later found no evidence implicating Liminal Custody’s infrastructure at the time, Wazir’s custodian partner in the multi-million-dollar hack.
- The hacker of the WazirX platform gained access by compromising the multi-signature feature of the platform and made away with assets worth over $235 million.
- The hacker has since then laundered the stolen assets using the notorious crypto mixer Tornado Cash.