CoinDCX Loses $44 Million in Security Breach

CoinDCX, a prominent crypto exchange in India, has fallen victim to a significant security breach, resulting in a loss of $44 million. The incident involved the compromise of an internal account used for liquidity provisioning with a partner exchange. This hack comes just a year after another major Indian exchange, WazirX, suffered a $230 million exploit, highlighting the ongoing challenges faced by the crypto industry in maintaining robust security measures.

Blockchain analyst ZachXBT was the first to identify the breach, noting that the attacker's address was initially funded with 1 ETH from Tornado Cash and later bridged a portion of the stolen funds from Solana to Ethereum. Shortly after ZachXBT's findings, CoinDCX CEO Sumit Gupta confirmed the hack, attributing it to a "sophisticated server breach" that compromised one of the exchange's internal wallets.

In a public statement, Gupta assured that the hack did not affect any customer assets, which remain secure in cold wallet storage. He emphasized that the exchange intends to cover the loss from its own treasury reserves. Gupta also noted that the incident was quickly contained by isolating the affected operational account, ensuring that the exposure was limited to this specific account.

CoinDCX has taken immediate action by collaborating with cybersecurity experts to investigate the hack, address vulnerabilities, and track the movement of the stolen funds. The exchange is also working with its partners to block and retrieve the looted assets and plans to launch a bug bounty program to enhance its security measures. The incident underscores the importance of continuous vigilance and robust security protocols in the crypto industry.

The security breach at CoinDCX follows a similar incident at WazirX, which suffered a $235 million loss last year. The WazirX hack was believed to be orchestrated by North Korean hackers, leading to the exchange halting all operations. The ongoing challenges faced by crypto exchanges in India highlight the need for enhanced security measures and regulatory oversight to protect both exchanges and their users from such attacks.