The minute I heard about the theft of $230 million, I thought to myself, ‘Here we go again.’
The stolen funds are being recovered and Nischal Shetty, a co-founder of Wazirx, has made sure that everyone knows about their progress. This is a good move launching a bounty program. It’s like issuing out an APB into cyberspace. Maybe a white-hat hacker could be one answer and help in hunting those millions. They are also seeking assistance from other exchanges. This feels like an online neighborhood watch unfolding before my eyes. In my view, this type of cooperation cannot be overemphasized in crypto-space. Indeed if one exchange doesn’t have another’s back then who does.
The overall situation is making me think about the wider implications for the Web3 ecosystem in India. I mean, Wazirx isn’t some small-time player - they are a major player in the Indian crypto scene. This hack will definitely erode investor confidence; we might even see some regulatory implications resulting from it. Speaking of regulations, Wazirx has already informed CERT-In and Financial Intelligence Unit. It’s just a reminder that even in the decentralized world of crypto, centralized authorities still matter when things go wrong.
The wrangling between Wazirx and Liminal on the hacked wallet is like watching high stakes game of hot potato. Wazirx says it was Liminal’s fault while Liminal says it is not their problem. To me this demonstrates the intricacies of custodial arrangements in crypto space. It's not always clear where responsibility lies when things go wrong.
I wonder how this would affect the normal client of Wazirx. I must admit I’d be pretty uneasy right now if I had money on the platform. Although it is well reassuring that they promised to look into what has happened to their customers, in crypto world promises are not always followed by actions.
Sometimes one can get carried away by bull markets and forget that such security lapses could happen anytime in this space. It’s a wake-up call for all, including me, to take digital securities seriously.
Depending on how these major breaches are handled; it might become a case study for similar incidents in the Indian cryptocurrency market. They have been dealt a great blow but also an opportunity for them to demonstrate leadership and strength when faced with challenges at Wazirx.