Bonk (bonk) 
Indian crypto exchange WazirX, which experienced a $230 million hack in July, has announced it is moving customer funds to new multisignature wallets and ending its relationship with its current crypto custody provider.
In an update on August 14, WazirX informed its customers about the aftermath of the attack, stating it was transferring remaining assets from its previous custody provider to new multisig wallets to ensure maximum security.
“We are in the process of migrating the remaining assets held with our current provider to new multisig wallets. This step is essential to ensure maximum security of the assets,” the exchange said.
In a post-mortem report published shortly after the attack, the Mumbai-based exchange explained that its multisig wallets required signatures from three team members and another from the crypto custody service provider to verify a transaction. However, attackers exploited a discrepancy between the data displayed on the provider’s interface and the actual transaction data, allowing them to take control of the wallet.
The attackers managed to steal over $230 million in various cryptocurrencies, including Ethereum, Shiba Inu, Polygon, and Pepe, ultimately converting the lesser tokens into more than 59,000 ETH.
This attack impacted the exchange’s ability to maintain a 1:1 collateral with its assets, leading to a halt in both crypto and fiat withdrawals.
In response, WazirX attempted to implement a “socialized loss strategy,” allowing users to access 55% of their funds, with the remaining 45% held by the exchange in Tether equivalent tokens. However, this proposal was met with significant backlash, as users accused the exchange of evading full responsibility for the losses. Consequently, WazirX retracted the plan and requested more time to develop a resolution.
The custody provider has since stated that its infrastructure was not breached and that all wallets in its custody, including those of WazirX, were secure. Despite this, WazirX maintains that the provider’s systems and interface were compromised during the July 18 exploit, necessitating the precautionary measures.
WazirX has not provided an exact timeline for the wallet migration but has assured that it will publish a list of all new addresses once the process is complete.
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