WazirX uses forensics and law enforcement to identify hackers behind $230M breach

In response to the devastating $230 million security breach, WazirX revealed that it has filed a formal complaint against the police and is exploring additional legal avenues to hold those responsible accountable.

Immediate actions include reporting the incident to the Financial Intelligence Unit (FIU) and the Indian Computer Emergency Response Team (CERT-In).

WazirX Comprehensive Action Plan

In the latest update, the Indian crypto exchange also said that it has contacted more than 500 exchanges to block the compromised addresses. Many of them are cooperating, and WazirX is now leveraging their support to accelerate recovery efforts.

The company’s action plan focuses on tracking the stolen funds, recovering customer assets and conducting a thorough investigation of the attack. We are working with forensic experts and law enforcement to identify and arrest those responsible for this massive breach.

However, the recovery of user funds remains questionable, as more than 45% of WazirX’s reported bookings as of June 2024 have been stolen.

According to blockchain analytics firm Elliptic, the attack showed typical traits of North Korean threat actors, who have exchanged the stolen assets for Ether using decentralized services. This view was further supported by popular crypto researcher ZachXBT at X, who speculated that the hack could be linked back to the Lazarus Group.

Regulatory clarity is needed to protect retail investors

WazirX is notable for being one of the few exchanges registered with the Financial Intelligence Unit (FIU) in India, allowing it to offer crypto trading services despite the country’s tough regulations. The high-profile hack comes at a time when there is increased debate over the legality of crypto assets in the country.

India currently lacks dedicated crypto regulation, and Joanna Cheng, associate general counsel at Fireblocks, said the industry would benefit from clear regulatory expectations on issues such as security standards, risk management and protection of consumer

In a statement to CryptoPotato, Cheng further added that regulatory intervention in this space would also mean that exchanges serving large numbers of retail clients are held accountable for their actions or inaction.

“We believe this incident highlights the importance of regulatory clarity and oversight, in order to establish a basic level of accountability and investor protection, particularly where retail investors are involved.”

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