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The founders of the troubled Indian cryptocurrency exchange WazirX reportedly encountered inquiries from government representatives seeking details regarding the unlawful transfer of cryptocurrencies from its wallets on July 18.
Local Indian news source Moneycontrol reported on the investigation earlier today. The founders of WazirX met with a group of officials from the Financial Intelligence Unit (FIU), Intelligence Bureau (IB), and the Indian Computer Emergency Response Team (CERT-In) at the exchange’s Mumbai office in recent weeks.
According to sources, a team comprising eight to ten officials from these agencies engaged with the WazirX executives. They allegedly discussed methods to determine how tokens valued at $235 million were transferred to the hackers.
WazirX also explored the potential for an internal breach; however, “no foul play has been detected as of now.”
The exchange provided transaction information, blockchain addresses associated with the hackers, and server logs from the laptops. The report indicated that no personal items, such as laptops, were seized.
“The government is worried about the magnitude of the illegal transfer at WazirX as it affects retail investors,” another source remarked.
“The government agencies have requested some data to comprehend the structure, the mechanics of the transfers, liquidity, and so forth. The hack occurred due to the ambiguous areas since the sector is unregulated.”
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FIU Engages with Crypto Stakeholders Following WazirX Hack
In the aftermath of the hack, the FIU, the national agency responsible for gathering information on suspected financial transactions, has reached out to several stakeholders in the cryptocurrency industry. The FIU operates under the Ministry of Finance.
The Intelligence Bureau (IB), which falls under the Home Ministry, is assessing the security and counterintelligence dimensions of the significant hack. Additionally, CERT-In, as the primary agency addressing cybersecurity threats, is investigating the technical aspects of the WazirX breach.
WazirX, one of the prominent cryptocurrency exchanges in India, experienced a significant security incident on July 18, resulting in the loss of $234 million. The funds were taken from its Ethereum wallet, leading to a nearly 45% reduction in the exchange’s holding assets.
The investigation is taking place amid the exchange’s restructuring efforts. WazirX’s parent company, Zettai, is in discussions with 11 cryptocurrency exchanges and trading firms to obtain emergency funding.
Furthermore, on October 4, WazirX announced its intention to establish a Committee of Creditors (COC) as part of the restructuring initiative for Zettai Pte Ltd.
Formation of Committee of Creditors (COC)
We’re in the process of forming a Committee of Creditors (COC) to represent creditors’ interests in the proposed restructuring of Zettai Pte Ltd. The COC will play a critical role in providing feedback, monitoring progress, and… pic.twitter.com/1etNxhPyIt— WazirX: India Ka Bitcoin Exchange (@WazirXIndia) October 2, 2024
The article titled Indian Govt. Officials Probe Crypto Exchange WazirX’s $234M Hack: Report first appeared on Cryptonews.
