The United States Federal Bureau of Investigation (FBI) has approached Indian cryptocurrency exchange WazirX to aid in investigating a significant cyberattack believed to be linked to North Korean cybercriminals, according to industry insiders.
A person close to WazirX said, “Global law enforcement agencies, such as the FBI, want to future-proof their own cryptocurrency market from any such shocks, and their expertise will greatly benefit the company’s efforts as well.”
On July 18, the attack targeted one of WazirX’s multisig wallets, resulting in a loss of over $230 million, equating to approximately 45% of the investors’ funds.
Nischal Shetty, co-founder of WazirX, believes the Lazarus Group, a cybercrime group renowned for its highly skilled assaults on cryptocurrency exchanges and purportedly supported by North Korea, may have been involved, even if the precise offenders are unknown.
Despite the magnitude of the attack, WazirX allowed trading to continue for three days post-breach, which led to a 10-15% drop in major cryptocurrency prices on the exchange.
Shetty underlined that stabilizing the platform and averting widespread liquidation were the top priorities. In a week, an independent forensic auditor’s assessment is anticipated, which will offer further details on the assault.
WazirX has suggested a “socialized loss strategy” to share the effects among users, enabling most investors to get back up to 55% of their investments. Since INR was not a part of the theft, investors holding funds in INR are entitled to 100% withdrawals.
Shetty highlighted the challenges of obtaining insurance for the crypto industry in India and emphasized the potential for fund recovery with global law enforcement’s expertise.
WazirX is working with Liminal, a wallet infrastructure and digital asset custody solution provider, to bring in an external auditor. Transparency and communication with stakeholders are prioritized as WazirX navigates the aftermath of this unprecedented cyberattack.
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