WazirX Exploit: $6.5M Laundered Through Tornado Cash
WazirX Exploit – A wallet address linked to the hacker responsible for stealing over $235 million from Indian cryptocurrency exchange WazirX has recently moved $6.5 million worth of funds through the sanctioned crypto mixer Tornado Cash.
In a September 3rd update on X (formerly Twitter), blockchain security platform Cyvers reported that the hacker had transferred a total of 2,600 Ether (ETH), valued at approximately $6.5 million at current market prices, to Tornado Cash. This action appears to be an attempt to obscure the origin of the stolen assets.
$6.7 Million Held by Hacker Before Transfers
According to data from crypto tracking platform DeBank, the wallet address associated with the hacker held $6.7 million in total as of September 2nd. However, following 26 separate transfers of 100 ETH each to Tornado Cash within just one hour, the wallet now holds only $154,000. The rapid sequence of transactions suggests a deliberate effort to launder the stolen funds and evade tracking by authorities.
WazirX Initiates Early Withdrawal Window for Users
In a related development, WazirX has announced that users can now withdraw up to 66% of their Indian Rupee (INR) token balances from the exchange, nearly a week ahead of the initially planned withdrawal window. The exchange made this announcement via a post on X on September 3rd, stating, “Starting today, all eligible users can now withdraw up to the full 66% limit of their INR balances.”
Originally, the withdrawal period was set to begin on September 9th. However, WazirX opted to move the window forward, enabling users to access their funds sooner amid ongoing concerns following the massive July 18th exploit.
WazirX’s Plan to Restore Financial Operations
After the $235 million hack, WazirX is in the midst of executing a staggered plan aimed at restoring its regular financial operations. This plan includes the reinstatement of Indian rupee withdrawals, which began on August 26th. Despite the progress, the exchange has reported that 34% of INR-denominated balances remain “frozen” due to ongoing investigations by various law enforcement agencies.
Legal Challenges and Restructuring Efforts
WazirX has acknowledged that there are still legal issues affecting crypto withdrawals, adding another layer of complexity to the situation. Additionally, the exchange is pursuing legal proceedings in Singapore, where it has chosen to base its legal restructuring efforts. This move is part of WazirX’s broader strategy to navigate the challenges posed by the hack and to ensure compliance with regulatory requirements.
FAQ
What happened to WazirX in July 2024?
In July 2024, the Indian cryptocurrency exchange WazirX was hacked, resulting in the theft of over $235 million in funds. This incident has led to significant disruptions in the exchange’s operations and affected users’ access to their assets.
How did the hacker move the stolen funds?
The hacker recently transferred $6.5 million worth of Ethereum (2,600 ETH) through Tornado Cash, a sanctioned crypto mixer. This move is believed to be an attempt to launder the stolen funds and make them harder to trace.
What is Tornado Cash and why is it significant in this context?
Tornado Cash is a cryptocurrency mixer that allows users to obscure the origins and destinations of their crypto transactions. It has been sanctioned by regulators because it is often used to launder illicit funds, as seen in this case with the WazirX hacker.
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