WazirX accelerated the second phase of its fiat withdrawals, but unfortunately, this prompted hackers to take action. The exchange had originally planned for the withdrawal process to start on September 9th but moved it up to September 3rd due to the urgency. This decision comes in the wake of a major security breach that resulted in the theft of more than $230 million in user assets. CEO Nishal Shetty provided an update on social media, assuring customers that the exchange is doing everything possible to restore access to their funds.
As of now, WazirX users can withdraw up to 66% of the total INR (Indian Rupee) amount deposited on the exchange. The remaining amount will become accessible at a later date. This early withdrawal access is an important step for WazirX as it undergoes a restructuring process in Singapore. The exchange has been dealing with the aftermath of the security breach that occurred in July. During the hack, a vulnerability in one of WazirX’s multisig wallets was exploited, resulting in significant asset losses, including $100 million worth of Shiba Inu (SHIB) and $52 million worth of Ethereum (ETH).
To address these challenges and try to reimburse affected users, the exchange had to suspend its operations and pursue restructuring. However, legal advisers have cautioned that it is unlikely customers will recover the full amount of their lost funds. The best-case scenario currently projects a return of only 55% to 57% of the original assets, leaving many users uncertain about their future on the platform.
Meanwhile, the hacker responsible for the breach made a significant move by using the crypto mixer Tornado Cash to move the stolen Ether. On September 2nd, nearly $6.5 million worth of Ether was transferred in 16 transactions on the Ethereum network. This action is noteworthy because the hacker’s address, which holds more than $155 million in various tokens, had not previously utilized Tornado Cash. The ongoing investigation suggests that the attack on WazirX might be the work of the North Korean hacking group Lazarus, known for its sophisticated cyber operations and involvement in laundering over $1 billion in stolen funds. The group has faced international sanctions due to its activities.