In a recent update on the ongoing hack investigation, the WazirX exchange has declared that its systems and laptops were not compromised during the $230 million cyberattack. This assurance follows a thorough forensic investigation by Mandiant Solutions, a Google subsidiary. The report concluded that the issue likely stemmed from its former infrastructure and custody partner, Liminal.
WazirX Exchange Receives Clean Chit After Forensic Probe
WazirX, one of India’s largest crypto exchanges, experienced a significant security breach last month, resulting in the loss of nearly 45% of its holding assets. The attack targeted a multisig wallet, an advanced crypto wallet requiring multiple private keys to authorize transactions. The compromised wallet had six signatories: five from WazirX and one from Liminal.
According to the exchange, “All transactions from the Multisig wallet required approval from three members of WazirX, followed by the final authorization from Liminal.” Despite this, the forensic report stated, “We did not identify evidence of compromise on the three laptops that were used for signing transactions.”
The findings of Mandiant Solutions have led to claims that the WazirX hack was not due to internal failures but rather an issue with Liminal’s security. “The findings largely indicate that the issue leading to the cyberattack originated from Liminal,” the exchange said, according to a MoneyControl report.
The WazirX exchange has expressed full confidence in the forensic investigation and is committed to cooperating fully. Moreover, a spokesperson for the exchange commented:
“We have full faith in the investigating agency and shall cooperate with them to the fullest extent. We are actively working on recovering the stolen funds and are hopeful that those responsible will be brought to justice.”
In response to the hack, WazirX has implemented several recovery strategies. The platform is exploring options including a Bounty Program offering rewards up to $10,000 worth of USDT. Also, it released a poll to consider user opinion for next steps.
Furthermore, the Indian crypto exchange is engaging with rivals and industry peers for support or a potential buyout. Additionally, the WazirX exchange had earlier approached its former partner Binance. Earlier, Binance controlled a significant portion of its revenue and WRX tokens valued at $80 million.
Latest Updates By The Exchange
The crypto exchange has also engaged with the Financial Intelligence Unit of India (FIU) and the Indian Computer Emergency Response Team (CERT) to address the aftermath of the breach. As part of its response, the WazirX exchange initially proposed a “55/45 approach” to mitigate customer losses.
It would allow users to access and trade 55% of their portfolio tokens. Whilst, the remaining 45% user funds would be converted to USDT and locked until fund recovery. However, this proposal faced significant backlash from customers and was eventually scrapped.
Meanwhile, after the hack fiasco, Liminal is no longer a custody partner for the exchange. Also, the platform completed the restoration of balances by undoing all trades between July 18 and July 21. This action was taken as the platform failed to block unauthorized trades during that period.
Kritika Mehta
Kritika boasts over 2 years of experience in the financial news sector. Currently working as a crypto journalist at Coingape, she has consistently shown a knack for blockchain technology and cryptocurrencies. Kritika combines insightful analysis with a deep understanding of market trends. With a keen interest in technical analysis, she brings a nuanced perspective to her reporting, exploring the intersection of finance, technology, and emerging trends in the crypto space.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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