As a researcher with extensive experience in the crypto market and cybersecurity, I find the recent WazirX hack to be a concerning development. Having closely monitored the Indian crypto exchange scene for years, it is disheartening to see one of its major players face such a significant security breach.
Following a significant cyberattack on Indian cryptocurrency platform WazirX last Thursday, the value of pilfered altcoins such as Shiba Inu plummeted. Surprisingly, Bitcoin and other altcoins were also trading at substantial discounts on July 19.
On Friday, nearly every cryptocurrency token listed on WazirX experienced significant price drops compared to their international market values, indicating intense selling activity and insufficient liquidity within the platform.
Photo: WazirX
- The Bitcoin/Rupee trading pair has dropped 22% in the past 24 hours, significantly more than on other local exchanges like CoinDCX and Zebpay, where prices fell by 2%. The Shiba Inu/Rupee pair has also declined by 30%. WazirX’s WRX token is down 40% in the past 24 hours. However, trading volumes on the exchange surged to $8 million, up from $2.2 million on Wednesday.
WazirX experienced a significant security incident involving one of its multisig wallets, resulting in over $200 million being stolen from the exchange. The thief made off with over $100 million in Shiba Inu and approximately $52 million in Ether during this breach. Notably, data from the blockchain indicates that WazirX has recently exchanged a large quantity of these cryptocurrencies for Ethereum, mere days before an anticipated Ethereum ETF launch.
As a crypto investor, I was dismayed to discover that more than 45% of the total reserves reported by the exchange in June 2024 had been stolen. This alarming development left many users, including myself, feeling uncertain about the possibility of recovery. The exchange attributed the theft to a discrepancy between their digital interface and a major crypto wallet. Surprisingly, this issue arose despite having five WazirX signers on the wallet that was supposed to safeguard our assets. In a message on their platform, the exchange explained:
During the cyber attack, there was a discrepancy between the data shown on Liminal’s screen and the authentic signed information. It’s suspected that the attacker swapped out the payload to seize control of the digital wallet.
North Korean Hackers behind WazirX Hack
According to the latest analysis from blockchain firm Elliptic, it is believed that the North Korean cybercriminals in the notorious Lazarus Group were responsible for the recent hack. Similarly, analyst ZachXBT pointed out some similarities between the WazirX hack and past attacks attributed to the Lazarus Group.
Starting from the Ethereum address 0x6ee, I’ll trace back the theft that occurred on July 10th. This address had previously carried out test transactions using Shibaswap (SHIB) tokens from multisig wallet 0x09b. The funds for these transactions were supplied through six transfers, each amounting to 0.1 Ether, which were sent anonymously via Tornado.
0x6eedf92fb92dd68a270c3205e96dccc527728066
A technical breakdown of the attack by Mudit can be found below
— ZachXBT (@zachxbt) July 18, 2024
Based on an examination conducted by ZachXBT and posted on X, the pilfered assets were transferred to an address that had been previously funded through Tornado Cash – a popular tool for concealing the source of cryptocurrency finances – following the hack.
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2024-07-19 16:27