Shiba Inu plummets nearly 10% after $100M SHIB tokens compromised in WazirX hack

Shiba Inu (SHIB) has seen a significant downturn amid the unsettling news of a major security breach at WazirX, one of India’s prominent cryptocurrency exchanges.

At press time, SHIB’s price stood at $0.00001722, reflecting a 9.99% decline over the past 24 hours amid broader market concerns.

Earlier today, it was reported that WazirX’s security infrastructure was compromised, resulting in the unauthorized transfer of approximately $235 million worth of various cryptocurrencies, including over $100 million in Shiba Inu tokens.

The breach was detected by Web3 security firm Cyvers, which detected multiple suspicious transactions linked to WazirX’s Safe Multisig wallet on Ethereum, revealing that the attacker utilized Tornado Cash, a decentralized protocol for private transactions, to obscure the movement of funds.

At the time Cyvers was making the alert, the hacker had already liquidated a substantial portion of the stolen assets, converting them primarily into Ether (ETH), further amplifying selling pressure on affected cryptocurrencies including SHIB.

Is Lazarus Group behind this hack?

ZachXBT, a cryptocurrency investigator, provided insights into the hack, suggesting similarities to previous cyber-attacks associated with sophisticated threat actors like the Lazarus Group.

Despite efforts to trace the transactions, the complexity of blockchain transactions, including the use of anonymous services, has posed challenges to fully unraveling the flow of compromised funds.

Shiba Inu (SHIB) impacted the most by the breach

Besides SHIB, the Multisig wallet also held $52M in Ether (ETH), $11M in Polygon (MATIC), $4.7M in Floki (FLOKI), $3.2M in Fantom (FTM), $2.8M in Chainlink (LINK), and $2.3M in Fetch.ai (FET).

All these coins including WazirX’s native token WRX have seen significant drops. However, SHIB and WRX appears to be the most hit with WRX dropping by 13.78% at press time to $0.1439.

FTM has dropped by 8.48%, FET by 7.21%, MATIC by 7.13%, FLOKI by 6.04%, LINK by 4.54%, and ETH by 1.56%.

WazirX’s response

In response to the incident, WazirX has taken immediate steps to mitigate further risks, temporarily suspending withdrawals of both cryptocurrencies and Indian rupees from its platform.

The exchange has assured its users and stakeholders that it is actively investigating the breach and will provide updates as the situation develops.

Notably, the WazirX hack comes at a critical juncture for the cryptocurrency industry in India, where regulatory uncertainties have already cast a shadow over the market’s growth and stability.

The Financial Intelligence Unit (FIU) of the Indian Ministry of Finance recently issued compliance notices to multiple foreign cryptocurrency exchanges, underscoring the regulatory challenges faced by the sector.

As stakeholders await further developments from WazirX and regulatory bodies, market participants are bracing for potential continued volatility in Shiba Inu and other affected cryptocurrencies.

The incident serves as a stark reminder of the persistent cybersecurity threats facing digital asset exchanges and the importance of robust security measures in safeguarding user funds in the evolving landscape of decentralized finance (DeFi).

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