In a dramatic turn of events following the recent WazirX hack, the cybercriminal behind the breach has successfully moved $32 million worth of stolen Ether (ETH) within four days, using Tornado Cash, a decentralized privacy tool, to cover their tracks. The rapid movement of these stolen funds has raised alarm across the crypto community, with many questioning the safety of funds on centralized platforms.
The Hack and the Heist
WazirX, one of India’s largest cryptocurrency exchanges, suffered a security breach resulting in the theft of approximately $32 million worth of Ether. The hacker moved swiftly, utilizing Tornado Cash, an Ethereum-based privacy solution, to obscure the transaction trail. Tornado Cash has faced intense scrutiny from regulators due to its ability to mask crypto movements, making it an attractive tool for money launderers and cybercriminals.
Within 96 hours, the hacker completed several transactions, each cleverly routed through Tornado Cash’s mixing service, rendering the original source of the funds almost impossible to trace.
Binance’s Denial and CEO’s Claims
The founder of WazirX, Nischal Shetty, initially pointed fingers at Binance, claiming that the crypto giant’s delayed actions might have contributed to the scale of the loss. Shetty alleged that Binance failed to act quickly on certain account-related technicalities that could have potentially mitigated the situation.
However, Binance swiftly denied these claims. The exchange issued a public statement asserting that it had no operational control over WazirX and that its involvement was limited to providing wallet services. Binance further clarified that any allegations suggesting its negligence in the matter were baseless and misleading.
Community Reactions and Regulatory Concerns
The incident has once again highlighted the risks associated with centralized exchanges and the challenge of maintaining security in the face of sophisticated hacking attempts. It has also reignited debates around the use of privacy protocols like Tornado Cash, with regulators calling for stricter controls to prevent their misuse.
As authorities continue to investigate, users of WazirX and the broader crypto community are left questioning the safety of their assets and the effectiveness of existing security measures.
Conclusion
With $32 million worth of Ether now laundered through Tornado Cash, the chances of recovery seem slim. The ongoing dispute between WazirX and Binance adds another layer of complexity, as both platforms attempt to deflect blame and maintain their credibility. This incident serves as a stark reminder of the vulnerabilities within the cryptocurrency ecosystem, urging both users and platforms to remain vigilant and proactive in securing their assets.