WazirX recently reopened partial withdrawal of INR accounts as it sought legal assistance in Singapore to facilitate proper restructuring.
More than a month since India-based crypto exchange WazirX suspended operations due to the $234 million hack that heavily drained its reserves, on-chain data shows the attackers do not have intentions of returning the funds. The WazirX attackers believed to be the North Korea-based Lazarus Group, have already initiated the laundering process of the stolen funds through crypto mixer Tornado Cash.
According to on-chain data analysis conducted by PerkShieldAlert, the WazirX attacker has already sent 1.6K Ether, worth nearly $4 million, to Tornado Cash earlier on Thursday. The attackers had previously transferred 5k Ether, worth more than $12.1 million, to the address used to deposit funds to Tornado Cash.
#PeckShieldAlert #WazirX Exploiter -labeled address has transferred 5K $ETH (worth ~$12M) to a new address 0x2D29…a968
On July 18, India’s #CEX WazirX suffered a major security breach, resulting in the theft of over $230 million in cryptos. pic.twitter.com/12qlK9Q0KF— PeckShieldAlert (@PeckShieldAlert) September 5, 2024
Earlier this week, the WazirX exploiter transferred 2,600 Ether, worth over $6.5 million, to Tornado Cash. As a result, it is safe to assume that WazirX users and creditors may never be made whole again unless a potential investor purchases the entire company with its debt.
WazirX Exchange Takes Legal Measures
With all eyes on the next move by the WazirX exchange, some affected creditors led by CoinSwitch have sought alternative legal options to recover the funds. Furthermore, only funds stored outside the exchange in partnership with Liminal were stolen but not those on the platform.
Earlier this week, WazirX announced the second phase of INR withdrawals, whereby eligible users can access up to 66 percent of their INR balances. Although the move has been welcomed by some users, WazirX has yet to fully provide a plan on how the customers will be made whole again.
Meanwhile, the distressed cryptocurrency exchange has already filed a moratorium in the Singapore High Court to provide the necessary space to restructure the company.
Some experts believe WazirX exchange may be forced to find a potential buyer or sell its assets to repay the distressed investors.
Rising Attacks on Poorly Designed Smart Contracts
The crypto industry has suffered several losses in the recent past due to poorly designed smart contracts, which have been exploited by sophisticated attackers. The mainstream adoption of digital assets and web3 protocols has increased the number of attacks leading to the loss of customers’ funds.
For instance, on-chain analysts reported an attack on Penpie protocol on Wednesday, leading to the loss of over $16 million in Wrapped Ether, and liquid restaking assets. Earlier today, PerkShieldAlert reported that the Penpie attackers had already begun laundering the stolen funds through Tornado Cash.
The FBI released a report that North Korean cyber criminals are eying the funds stored by Coinbase Global Inc (NASDAQ: COIN) on behalf of the spot Bitcoin ETF issuers.
The rising attacks on the DeFi space have been criticized heavily for continually using poorly designed smart contracts, which are easily exploited by attackers.
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