WazirX Suspends Trading Following $230 Million Loss Due to ‘Force Majeure’ Event

WazirX, a major player among India’s crypto exchange platforms, has put a halt to all its transaction operations “temporarily” following an event just days earlier where it suffered a security infringement that led to the loss of $230 million, accounting for nearly half of its asset reserve.

Following the setback, the Mumbai-headquartered trading platform communicated via Twitter on Sunday evening that this digital breach severely compromised its potential to uphold a pivotal 1:1 asset to collateral ratio, prompting further anxiety surrounding the sufficiency of WazirX’s reserves and its capabilities to reimburse its clientele.

Earlier in the week, WazirX had to freeze withdrawals for its users after it was discovered that a malefactor managed to breach a multi-signature wallet of the exchange that held crypto assets in the magnitude of hundreds of millions. The security mechanism of the affected wallet involved six signatories, with five from the WazirX team.

“The digital assault occurred due to a mismatch between the data shown on Liminal’s platform and the actual transaction data,” remarked the company earlier in the week.

WazirX launched a reward initiative on Sunday promising up to $23 million as a bounty for any assistance that leads to the recovery of the plundered digital funds.

Initial investigations by the risk assessment entity Elliptic earlier in the week suggested that the perpetrator had connections to North Korea.

The disappearance of roughly $230 million is a substantial blow for WazirX, which reported an approximate total of $500 million in assets in its June reserve disclosure. The company has referred to the breach as “a force majeure occurrence.”

Peer exchanges in India, CoinSwitch and CoinDCX, which engage in business collaborations with WazirX, asserted earlier in the week that their users were not affected by the WazirX incident.