WazirX has announced the termination of its relationship with custody provider Liminal Custody following a significant security breach in July 2024, during which $230 million—approximately 45% of total customer funds—was stolen.
Details of the Incident
The breach, which occurred on July 18, involved the draining of funds from a Gnosis SAFE multisig wallet. This wallet was initially deployed by WazirX before its partnership with Liminal and later integrated into Liminal’s platform. The incident has sparked a public dispute between the two companies, with both parties attributing responsibility to the other for the exploit.
WazirX’s Response
In a post on X, WazirX detailed the steps they are taking to secure the remaining assets. The exchange is migrating funds from Liminal to new multisig wallets, emphasizing that this move is essential to ensure the highest level of security for users’ assets. WazirX assured its users that while their interface and systems remain uncompromised, concerns were raised about the custodian's interface following the breach. WazirX also promised to exercise extreme caution during the asset migration process, citing the complexity involved. Although no exact timeline was provided, the exchange committed to transparency by announcing that a list of all new wallets will be published once the migration is complete. Additionally, WazirX shared a link for users to view the on-chain list of affected assets and related transactions performed by the attacker.
Liminal’s Defense
On July 19, 2024, Liminal responded with an in-depth report aiming to clarify the events leading to the breach. Liminal asserted that their infrastructure remains uncompromised and that the compromised wallet was imported into their platform by WazirX for operational ease. The report sought to defend Liminal’s position, although the company acknowledged that such breaches inevitably lead to scrutiny of all parties involved.
This incident highlights the importance of security in the cryptocurrency sector and the need for careful selection of asset custodians.
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