Investors are growing restless as the hacker behind the WazirX breach has started funneling millions of dollars in user assets through Tornado Cash following the Indian exchange’s $230 million exploit on July 18.
Early Tuesday morning, the exploiter initiated the transfer of 2,600 ETH, valued at $6.5 million, to the sanctioned mixer Tornado Cash, according to blockchain security firm PeckShield.
In August 2022, the U.S. Treasury Department sanctioned Tornado Cash, claiming it “has been used to launder more than $7 billion worth of virtual currency since its creation in 2019,” Despite its ban in the U.S. the platform still operates across a number of jurisdictions, including in North Korea.
According to a tracker by blockchain analytics firm Arkham Intelligence, the WazirX hacker has carried out 26 transactions, each transferring 100 ETH to Tornado Cash, to mask the flow of funds. The transactions commenced mere hours after WazirX’s first town hall meeting to discuss its moratorium application.
Last month, WazirX experienced a major security breach in one of its multi-sig wallets, resulting in one of the largest crypto thefts in India’s history.
In the aftermath of the hack, WazirX implemented a 66% limit on users’ Indian rupee withdrawals and has taken legal steps by filing an affidavit with the High Court of Singapore.
The exchange is asking for a six-month moratorium so its holding company, Zettai, can work on restructuring its liabilities.
“It’s highly unlikely there can be a recovery in crypto terms, at 100%,” stated Jason Karachi, managing director at Kroll during the town hall meeting. “The present numbers indicate a range of 52%-57% in crypto terms.”
Investors who watched the live session expressed disappointment, claiming the event failed to provide any new clarity beyond what the companies had previously stated.
Trading on the exchange will resume once creditors approve the restructuring proposal and the court sanctions it.
Edited by Sebastian Sinclair
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