The hacker responsible for the $235 million crypto heist of WazirX allegedly converted approximately $150 million worth of the stolen altcoins into Ethereum (ETH). Analysts say this move was likely to prevent the funds from being frozen or blacklisted by authorities or token issuers.
Altcoins Converted to Ethereum
According to blockchain analysis firm Spot On Chain, the hacker converted $90.2 million worth of Shiba Inu (SHIB), $10.2 million worth of Polygon (MATIC), and approximately $7.5 million worth of Pepe (PEPE) into Ethereum between July 18-19. The hacker’s actions increased the total amount of stolen funds held in ETH from the initial $52 million to $201 million. Blockchain security experts noted that this conversion to ETH serves multiple purposes. Spot On Chain explained that while some ERC-20 tokens have contract functions allowing addresses to be blacklisted, Ethereum does not. This step means that once converted to ETH, the funds cannot be easily frozen.
Additionally, the transition to ETH could help the hacker secure the funds quickly before authorities take any preventive measures. Another blockchain security firm, PeckShield, emphasized that converting to Ethereum facilitates laundering through various cryptocurrency exchanges and mixer protocols due to its stability and liquidity.
The crypto heist had a noticeable impact on the market, particularly on the prices of the affected altcoins. For instance, the price of Shiba Inu (SHIB) reportedly dropped by approximately 7% following the incident, while the price of ETH remained relatively stable, experiencing only a 0.1% decrease.
Hacker’s Remaining Holdings
According to Spot On Chain, despite the large conversion, the hacker still holds approximately $12 million worth of other tokens, including Chromia (CHR), Celer Network (CELR), Frontier (FRONT), and Ooki (OOKI). These holdings remain at risk of being converted into more secure assets like Ethereum or Bitcoin (BTC). The hacker’s diverse portfolio of tokens suggests a calculated approach to managing the stolen assets, aiming to maximize liquidity and minimize the risk of detection. This strategic diversification indicates a deep understanding of the cryptocurrency market, allowing the hacker to potentially leverage market conditions to further obfuscate the origin of the stolen funds.
Advertisement Banner
WazirX’s Response to the Crypto Heist
In response to the crypto heist, news sources report that WazirX halted all withdrawals on July 18, citing a force majeure event that compromised nearly half of its reserves. The exchange stated that it is doing everything possible to recover the stolen funds, including blocking deposits and contacting the relevant wallets. Additionally, WazirX is allegedly collaborating with international law enforcement agencies and cybersecurity firms to trace the stolen assets and apprehend the perpetrators.
Final Thoughts
The crypto heist highlights the vulnerabilities in the cryptocurrency exchange ecosystem and the challenges faced by authorities in recovering stolen funds. The strategic conversion of altcoins to Ethereum demonstrates a sophisticated understanding of blockchain technology and the measures needed to evade detection and asset freezing. This incident underscores the importance of robust security measures and the continuous evolution of tactics used by malicious actors.
As WazirX continues its efforts to recover the stolen funds, the broader cryptocurrency community remains vigilant in monitoring the situation and learning from this significant breach. Industry experts are calling for improved regulatory frameworks and enhanced security protocols to protect exchanges and their users from future attacks. This crypto heist serves as a stark reminder of the ongoing risks in the digital asset space and the need for collective action to safeguard the integrity of the cryptocurrency ecosystem. Additionally, it highlights the importance of user education and awareness in mitigating potential threats and enhancing overall security.
The price predictions and financial analysis presented on this website are for informational purposes only and do not constitute financial, investment, or trading advice. While we strive to provide accurate and up-to-date information, the volatile nature of cryptocurrency markets means that prices can fluctuate significantly and unpredictably.
You should conduct your own research and consult with a qualified financial advisor before making any investment decisions. The Bit Journal does not guarantee the accuracy, completeness, or reliability of any information provided in the price predictions, and we will not be held liable for any losses incurred as a result of relying on this information.
Investing in cryptocurrencies carries risks, including the risk of significant losses. Always invest responsibly and within your means.
