Indian crypto exchange WazirX says one of its multisig wallets “experienced a security breach” after $230M+ in withdrawals; WazirX had $500M in holdings in June

One of the exchange's multisig wallets experienced a security breach, the exchange confirmed in an X post.

CoinDesk 2024-07-18 Shaurya Malwa

Context & Ripple Effects

WazirX's reported loss is large relative to the roughly $500M in holdings cited for June, making custody controls and the treatment of customer balances central rather than a contained operational issue.

Related coverage shows the incident escalating from wallet compromise to suspended withdrawals and trading, then to a disputed plan to spread the loss across customers. A later court-approved restructuring and planned return to operations indicate how long such a custody failure can shape an exchange's recovery.

First-order effects

WazirX must secure the affected wallet environment, trace the withdrawn assets, and determine the extent of the balance-sheet and customer-fund exposure.
Customers with assets on the exchange face immediate uncertainty over access to balances and the platform's ability to meet claims.

Second-order effects

A disruption in withdrawals or trading can push users toward self-custody or rival venues, while forcing WazirX to devote resources to incident response and customer communications.
The eventual proposal to socialize the loss shows how a wallet breach can become a contentious allocation decision between an exchange and its customers, not just a security remediation.

Third-order effects

If comparable failures persist, exchange users and counterparties are likely to place greater weight on custody architecture, wallet permissions, and evidence that customer assets can be protected and reconciled.
The episode underscores that multisig can reduce single-key risk but does not by itself eliminate operational, authorization, or third-party vulnerabilities; resilience depends on the surrounding controls.

The trend: Centralized crypto platforms are being judged increasingly on whether their custody and recovery processes can withstand a security failure without shifting losses or access risk onto customers.

Discussion

@wazirxindia @wazirxindia on x
📢 Update: We're aware that one of our multisig wallets has experienced a security breach. Our team is actively investigating the incident. To ensure the safety of your assets, INR and crypto withdrawals will be temporarily paused. Thank you for your patience and understanding.
@cyversalerts @cyversalerts on x
🚨ALERT🚨Hey @WazirXIndia, Our system has detected multiple suspicious transactions involving your Safe Multisig wallet on the #ETH network. A total of $234.9M of your funds have been moved to a new address. Each transaction's caller is funded by @TornadoCash. The suspicious [image…
@lookonchain @lookonchain on x
Update: #WazirX has ~$230M in assets stolen. Including: 5.43T $SHIB($102M) 15,298 $ETH($52.5M) 20.5M $MATIC($11.24M) 640.27B $PEPE($7.6M) 5.79M $USDT 135M $GALA($3.5M) ... ‼️Please note that the hacker is selling these assets! https://x.com/... [image]
@arkhamintel @arkhamintel on x
This bounty has been solved by ZachXBT @ZachXBT submitted definitive evidence of a KYC-linked deposit address used by the exploiter to receive funds from the WazirX exploit. This fulfills one of the criteria of the bounty - ‘Identifying a KYC centralized exchange deposit’. This
@arkhamintel @arkhamintel on x
New Intel Exchange Bounty: $235M WazirX Hack This morning, WazirX experienced a security breach in one of their holding wallets. The incident resulted in over $235 million in funds lost. Addresses associated with the hacker include: 0x6EeDF92Fb92Dd68a270c3205e96DCCc527728 066 [im…
@neilshroff Neil on x
Some thoughts: 1) If to most people WazirX was so obviously hackable why did it take so many years for someone to do it? 2) WazirX had....HOW MUCH money??? 3) Fishy vibes for sure
@zachxbt @zachxbt on x
1/ So I began tracing the $230M+ WazirX hack back from the original exploiter address and was able to make some interesting observations. [image]
@wazirxindia @wazirxindia on x
📢 Update: It appears that the security issue involves one of our Liminal multisig wallets. Our team is actively working on the matter. Thank you for your patience and support. We'll keep you posted with further updates.
@awawat_trades @awawat_trades on x
group chat shaming the WazirX hacker for selling their SHIB in small lots like a bitch instead of FSH'ing like a man is the funniest thing
@lookonchain @lookonchain on x
🚨More than $230M of assets have been abnormally transferred from the #WazirX(@WazirXIndia) wallet to the wallet"0x04b2". Currently, wallet “0x04b2” is dumping these assets, and has dumped 640.27B $PEPE($7.6M). https://etherscan.io/... [image]
@eug_ng Eugene Ng on x
WazirX, one of India's largest exchange, got hacked. If Moody's is to start rating CEXs, they'd mostly be in the junk category.
@fuckyourputs Samson on x
Imagine if the wazirx hacker sold $100m shib and bought eth in one market order haha imagine hahahaha [image]
@adamscochran Adam Cochran on x
Massive hack on the largest local CEX in India. Government relations in India were already dicey so I expect they roll out another ban. Doesn't look good for WazirX, as no way their valuation comes close to covering these losses to even try an equity bailout.
@0xvazi @0xvazi on x
1/ The exploiter of the @WazirXIndia Multisig was able to drain it after changing the implementation of the Multisig, that couldn't have been done without compromising the signers EOA, but here's a closer look on the attack flow 🧵
@mudit__gupta Mudit Gupta on x
Desi Mt Gox just happened. RIP WazirX. Brace for another “crypto ban” in India. Centralized exchanges are literally the opposite of decentralized finance and cryptocurrencies but the politicians will use this hack to throw dirt at crypto. If you don't understand it, ban it. /s

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