WazirX has recently initiated the second phase of its fiat currency withdrawal process earlier than anticipated, on September 3. This acceleration in the withdrawal process was unexpected, as it was initially scheduled to commence on September 9.
CEO Nishal Shetty took to social media to share this update with users. He emphasized the ongoing efforts to restore access to customer funds following a major security breach that resulted in the theft of more than $230 million in user assets. Users are currently able to withdraw up to 66% of their total INR deposits on the exchange, with plans to unlock the remainder in the future.
As WazirX navigates the aftermath of the security breach, the exchange is undergoing a restructuring process in Singapore. In July, a hacker exploited a vulnerability in one of the exchange’s multisig wallets, resulting in the loss of significant assets, including $100 million in Shiba Inu (SHIB) and $52 million in Ethereum (ETH). This breach prompted WazirX to suspend operations and initiate restructuring efforts to compensate affected users.
Legal advisors working with WazirX have indicated that customers are unlikely to recover the full amount of their lost funds. The most favorable outcome forecasts a return of only 55% to 57% of the original assets. While the restructuring process endeavors to address these liabilities, the future remains uncertain for many impacted users.
In a separate development, the hacker responsible for the breach began moving the stolen Ether through the crypto mixer Tornado Cash on September 2, according to Arkham Intelligence data. This transfer amounting to nearly $6.5 million in Ether across 16 transactions on the Ethereum network marks a significant development in the investigation. The hacker’s address, holding over $155 million in various tokens, had not previously engaged with Tornado Cash, signifying a notable shift in their strategy.
Speculations point towards the North Korean hacking group Lazarus as the perpetrator behind the WazirX attack. Lazarus has a history of laundering stolen funds, exceeding $1 billion, and is notorious for its sophisticated cyber operations. The group’s activities have drawn international sanctions and pose a significant challenge to law enforcement agencies worldwide.
The accelerated fiat currency withdrawal process at WazirX highlights the ongoing challenges faced by the exchange post-security breach. With legal uncertainties surrounding the recovery of lost funds and hacker activities raising concerns, the road ahead remains arduous for WazirX and its users.