CoinDCX Suffers $44.2 Million Hack, Customer Funds Safe

On July 19, 2025, CoinDCX, a prominent Indian cryptocurrency exchange, fell victim to a significant security breach, resulting in the loss of approximately $44.2 million. The attack targeted an internal operational account used for liquidity provisioning on a partner exchange. The compromised funds were transferred through Tornado Cash, a privacy-focused protocol, to obscure the trail of the stolen assets. The hackers managed to bridge funds from Solana to Ethereum, employing a coordinated cross-chain laundering strategy. This incident marks one of the largest security breaches in the Indian cryptocurrency market this year.

The breach was initially detected by Cyvers Alerts, a blockchain threat intelligence firm, which flagged suspicious withdrawals from CoinDCX’s hot wallet. The funds were quickly routed through multiple wallets, complicating the tracing process. CoinDCX’s CEO, Sumit Gupta, confirmed the incident and assured users that customer funds remained safe, as the compromised wallet was not part of the exchange’s published proof-of-reserve reports. The platform has since frozen the affected internal systems and is collaborating with security experts to contain the incident and investigate the breach.

Key figures like Sumit Gupta and Neeraj Khandelwal have issued statements to assure the public, reiterating that customer funds remain secure and that the losses were covered by the company’s treasury. The attack targeted CoinDCX’s internal operational wallet, resulting in the loss of approximately $44 million. This breach involved the use of blockchain technologies to obscure movements.

Market reactions have been cautious, with most applauding CoinDCX's transparency. The quick containment of this breach ensures continued user confidence and maintains operational stability. The incident underscores vulnerabilities within crypto exchanges but also highlights CoinDCX's swift internal handling, minimizing broader market disruption and maintaining public trust.

CoinDCX has engaged with cybersecurity experts to trace and potentially recover the lost assets. This action reflects industry trends prioritizing prompt resolutions and security reinforcement. Sumit Gupta, CEO & Co-Founder of CoinDCX, stated, "Our internal security and operations teams have been working through the day along with leading cybersecurity partners to investigate the matter, patch any vulnerabilities, and trace the movement of funds. We are collaborating with the exchange partner to block and recover assets, including coming out with a bug bounty program soon."

Historical comparisons, such as the WazirX hack, reveal improvements in crisis management within the crypto sector. Future emphasis remains on strengthening security protocols and safeguarding user assets. The compromised wallet was not part of CoinDCX’s published proof-of-reserve reports, requiring manual attribution to identify the affected funds.

CoinDCX’s response to the breach has been transparent, with the CEO acknowledging the incident and providing updates to the community. The exchange has taken immediate action to secure its systems and is working diligently to address the security lapse. The incident underscores the importance of robust security protocols and the need for continuous vigilance in the cryptocurrency market. As the investigation continues, CoinDCX remains committed to ensuring the safety of its users’ funds and restoring confidence in its platform.