In a startling development, the crypto community is abuzz with rumors suggesting a possible insider connection in the recent massive hack at WazirX, one of India’s largest cryptocurrency exchanges. According to an unverified source claiming to be a top insider at WazirX, an Indian user who had completed their KYC verification just a week before the attack might have been part of the hacker team.
KYC-Verified User’s Suspicious Activity
The user in question reportedly registered on WazirX and deposited a substantial ₹1 crore (approximately $120,000) in cryptocurrency shortly before the hack. This substantial deposit, made so close to the date of the breach on July 18, raises questions about whether it was intended to facilitate the hack or to cover the perpetrator’s tracks. On the day of the attack, the hacker initiated withdrawals that led to the draining of WazirX’s GALA hot wallet, causing significant financial damage.
Insider Knowledge and Attack Execution
Sources suggest that one of the key elements of the attack was the hacker’s detailed knowledge of WazirX’s token reserves. It appears the hacker monitored the token balance closely and exploited the exchange’s protocol to force the transfer of more GALA tokens from the cold wallet to the hot wallet. The deliberate targeting of these wallets indicates a sophisticated understanding of the exchange’s operational procedures.
The breach resulted in a staggering loss of $234 million, wiping out 45% of the platform’s user funds. This catastrophic event has left many consumers in distress, desperately seeking reimbursement for their losses.
Legal and Regulatory Repercussions
In response to the crisis, WazirX has reportedly approached the Singapore High Court, filing a relief motion to address the aftermath of the attack and to work towards a resolution for the affected users.
This incident, if the involvement of a KYC-verified user is confirmed, would raise severe questions about the effectiveness of WazirX’s security measures and the potential for insider collaboration in such cybercrimes.
Ongoing Investigations and User Concerns
These allegations are currently based on insider claims and remain unverified. The crypto community and WazirX users are advised to await further information from official investigations before drawing conclusions.
In related news, WazirX is taking steps to mitigate the impact of the hack on its operations and customer confidence:
