In a major breakthrough, the Delhi Police Special Cell has arrested SK Masud Alam, a resident of East Midnapore, West Bengal, in connection with the Rs 2,000 crore cyberattack on cryptocurrency exchange WazirX. The arrest marks significant progress in unraveling one of India’s largest crypto heists.

 

The accused allegedly created a fake WazirX account under the name Souvik Mondal, later selling it on Telegram to another individual, M Hasan. Hasan is suspected of using the account to breach the crypto exchange. Alam’s arrest follows extensive investigations by the Intelligence Fusion and Strategic Operations (IFSO) division of the Delhi Police.

 

Details of the Cyberattack

The attack, which occurred on July 18, targeted WazirX’s hot wallet, causing the loss of over $230 million (around Rs 2,000 crore) in digital assets. Hackers also attempted to access the cold wallet, a more secure offline storage system. WazirX’s holdings suffered a 45% depletion due to the breach.

 

WazirX utilizes multi-sig wallets that require multiple signatories to authorize transactions. Of the six signatories for the breached wallet, five belonged to WazirX, and one was from Liminal Custody, a digital asset custody solutions firm responsible for securing the exchange’s wallets.

 

 Liminal’s Alleged Non-Cooperation

The chargesheet filed by Delhi Police accuses Liminal Custody of failing to provide crucial details despite repeated notices. This has raised questions about its security protocols and accountability. However, Liminal has denied the allegations, asserting its full cooperation with authorities. The company emphasized its commitment to transparency, stating it has formally responded to inquiries and held discussions with IFSO officials.

 

Investigation Updates

As part of the probe, investigators have seized three laptops from WazirX used by authorized signatories. WazirX has cooperated fully, providing key data such as KYC details and transaction logs. The IFSO division has found no evidence of unauthorized local or remote access to WazirX’s systems.

 

The Delhi Police is preparing a supplementary charge sheet to address Liminal’s role in the case further. Meanwhile, the investigation continues to trace the complex web of crypto transactions and hold all parties accountable.