WazirX Launches Legal Actions to Recover $235 Million Lost in Massive Crypto Hack

• The India-based cryptocurrency exchange WazirX has been struck by a significant cyberattack resulting in a $235 million loss for its investors.
• In response, WazirX has taken legal measures, including filing a police report and contacting relevant authorities.
• The hack targeted WazirX’s multisig wallet, exposing a vulnerability that the exchange is now addressing.

WazirX Confronts a Major Cyberattack, Launches Legal Action to Recover $235 Million in Stolen Funds

WazirX’s Swift Legal Response

Following the massive $235 million breach, WazirX wasted no time in initiating legal proceedings. The exchange has lodged a police complaint and reported the hack to crucial authorities, including the Financial Intelligence Unit (FIU) and India’s Computer Emergency Response Team (CERT-In). WazirX also issued a statement pledging to keep the community informed throughout the recovery process.

Collaboration with Crypto Exchanges

WazirX’s efforts extend beyond legal avenues. In an unprecedented move, the exchange has reached out to over 500 cryptocurrency exchanges globally, urging them to block addresses associated with the exploit. This collaborative initiative aims to prevent the sale or transfer of the stolen SHIB, ETH, MATIC, and PEPE tokens, valued collectively at $166.6 million. Concurrently, WazirX is working with other exchanges to further its investigation and recover the stolen assets.

Analysis of the Cyberattack

The breach targeted one of WazirX’s multisig wallets, managed by Liminal since February 2023. This wallet featured six signatories responsible for transaction verification, utilizing a whitelisting policy to enhance security. A mismatch between data on Liminal’s interface and the actual transaction content allowed the attacker to manipulate the payload, compromising the wallet’s integrity.

Proactive Measures and Multisig Wallet Vulnerability

WazirX has identified two additional smart contracts involved in the exploit. The exchange is conducting a thorough review to unearth the full extent of the attack and pinpoint vulnerabilities. To protect user funds, WazirX has launched a secluded website where users can revoke all approvals, though it emphasizes that funds remain at risk until this action is taken.

Market Impact and Recovery

The cyberattack has had a noticeable impact on the market. SHIB experienced a sharp decline of over 10% on the day of the exploit but has since begun to recover, increasing by 3% at the time of writing to a current price of $0.000017. The total crypto market capitalization currently stands at $2.3 trillion, following a recent recovery from a low of $1.9 trillion.

Conclusion

In light of the severe hack, WazirX’s prompt response and continued efforts to recover the stolen funds are crucial for maintaining investor confidence. By collaborating with global crypto exchanges and authorities, WazirX aims to not only retrieve the lost assets but also to fortify its security measures to prevent future incidents. As the situation evolves, the exchange’s diligence in investigation and proactive approach will be key to mitigating the long-term impacts of this breach.