SK Masud Alam, a resident of West Bengal, has been arrested by Delhi Police’s Special Cell in connection with a massive cyberattack on WazirX, a prominent cryptocurrency exchange. The attack, which resulted in an estimated loss of Rs 2,000 crore in digital assets, was a significant breach that raised questions about the security measures of the exchange.
According to the chargesheet filed by Delhi Police’s Intelligence Fusion and Strategic Operations (IFSO) division, Alam allegedly created a fake account under the name of Souvik Mondal, which was later sold to another individual, M Hasan, via Telegram. This fake account was then used to breach WazirX’s systems.
The investigation revealed that cybercriminals drained WazirX’s hot wallet and made attempts to breach its cold wallet, a more secure system that stores funds offline. In an attempt to get more information on the breach, Delhi Police reached out to Liminal Custody, the firm responsible for securing WazirX’s wallets. However, the firm allegedly failed to cooperate with the authorities despite repeated notices, complicating efforts to trace the stolen crypto assets.
WazirX has fully cooperated with the investigation by providing KYC details and transaction logs. The investigation also led to the seizure of laptops from the exchange to look into the misuse of multi-signature wallets. The chargesheet suggests that Liminal Custody’s role in the hack will be further examined in an additional chargesheet.
This cyberattack, which took place in July, led to the theft of over $230 million (approximately Rs 2,000 crore) from WazirX’s accounts. The breach impacted nearly 45% of the exchange’s holdings, highlighting significant vulnerabilities in the security infrastructure of digital asset exchanges.
The investigation is ongoing, with further raids planned to uncover the complete extent of the cybercrime network. The arrest of Alam is a crucial step toward understanding the complex web of transactions and fraud that led to one of the biggest crypto hacks in India.
