The Delhi Police have arrested SK Masud Alam, a suspect linked to a massive hack that drained around $230 million from the platform.
This cyber theft, which occurred in July, accounted for 45% of WazirX’s total assets.
What the hack happened?
Alam is accused of executing the hack using an account created under the alias “Souvik Mondal.”
Reports suggest that this account was utilized to conduct transactions and sell stolen virtual currencies through Telegram to another user, M Hasan, who allegedly exploited the platform further.
The cyberattack targeted both WazirX’s hot wallet and its cold wallet, essentially the online and offline storage for their funds, but investigators from the IFSO division have found no evidence of external attacks on WazirX’s systems.
This points to a more insidious form of internal manipulation involving multiple players.
3rd parties are security risks
The investigation has also turned its gaze toward Liminal Custody, the company responsible for WazirX’s digital wallets, and according to police claims, Liminal has been uncooperative, failing to respond adequately to requests for information that could aid the investigation.
This lack of cooperation raised questions about their incident management protocols and response mechanisms, which are now under further scrutiny by the Delhi Police.
On the other hand WazirX itself has been proactive in sharing Know Your Customer documents and transaction details with regulators.
They’re trying to help assess the full scale and method of the hack, because let’s face it, they need all hands on deck right now.
Hackers never sleep
As digital assets continue to gain traction in India’s financial sector, establishing robust security measures and legal frameworks is becoming increasingly important.
With Alam now in custody, it remains to be seen what further revelations will come to light as investigations continue.
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