Delhi Police Stop the Rs 2,000 Crore WazirX Crypto Theft, Arrest a Key Suspect

A suspect from West Bengal has been arrested by the Delhi Police in connection with the well-publicized cyberattack on the cryptocurrency exchange WazirX. The July breach resulted in the loss of digital assets valued at about Rs 2,000 crore.

By making a phony account under the name Souvik Mondal, the arrested person, identified as SK Masud Alam, is accused of orchestrating a portion of the cyberattack. Another suspect, M Hasan, allegedly purchased this account over Telegram and utilized it to breach WazirX's platform.

As investigators work to unravel the complex web of cryptocurrency transactions at play in this case, Alam's arrest by Delhi Police's Special Cell in East Midnapore, West Bengal, is seen as a significant breakthrough.

A chargesheet submitted by Delhi Police claims that a hack on WazirX's hot wallet was made possible by Alam's unauthorized account. The cold wallet, which has extra protection layers and stores money offline, apparently saw more attempts.

Unexpectedly, the chargesheet accuses Liminal Custody, the company in charge of protecting WazirX's wallets, of not fully assisting with the inquiry. The paper raises questions regarding Liminal's security procedures by pointing out that the company failed to reply to several formal requests for information.

The chargesheet states that as the inquiry progresses, a supplemental report will look more closely at Liminal's involvement.

Investigators confiscated three laptops used by WazirX's authorized signatories in order to further investigate the purported exploitation of the multi-signature wallet, which necessitates numerous authorizations for transactions. According to reports, WazirX has assisted the authorities by supplying necessary data, including as transaction logs and KYC information. Despite the compromise, no proof of illegal local or remote access to WazirX's systems has been discovered.

An Overview of the WazirX Cyberattack

A substantial loss of more than $230 million (about Rs 2,000 crore) in digital assets was caused by the July 18 incident. A multi-signature wallet containing six signatories—five from WazirX and one from Liminal Custody—was compromised by the hack. Of WazirX's assets, over 45% were affected by this occurrence.

WazirX, a platform for buying, selling, and trading cryptocurrencies like Bitcoin and Ethereum, was established in 2018. It has a native token, WRX, and integrates with Binance, a significant international cryptocurrency exchange. It also provides peer-to-peer transactions, staking, and spot trading.

In Response to Claims of Non-Cooperation, Liminal

Liminal Custody released a statement reaffirming its commitment to complete cooperation with the investigation in reaction to media stories implying non-cooperation. Liminal has participated with all official inquiries, including meeting directly with officials from the Intelligence Fusion and Strategic Operations (IFSO) section, according to a business representative.

A Liminal representative reaffirmed the company's commitment to regulatory compliance by saying, "We have proactively engaged with the authorities and remain committed to transparency and responsibility in addressing this matter."

In order to settle the case and strengthen digital asset security procedures, authorities are continuing the investigation, which is aided by the Indian Cyber Crime Coordination Centre.

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