India’s largest centralized cryptocurrency exchange CoinDCX says it has come under a major breach resulting in the theft of approximately $44 million.
The hack was first flagged by ZachXBT, who saw suspicious transactions involving the transfer of funds from Solana to Ethereum.
Shortly after, CoinDCX co-founder and CEO Sumit Gupta publicly acknowledged the breach, describing it as a “sophisticated server-level compromise.”
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He assured users that the affected wallet did not contain customer funds.
“The CoinDCX crypto exchange wallets storing user funds are not impacted and remain completely safe,” Gupta noted.
Breach Timeline and Fallout
The breach which was disclosed publicly nearly 17 hours after it occurred has drawn criticism from some corners of the crypto community.
Gupta attributed the delay to internal containment efforts and emphasized that only corporate funds were impacted.
CoinDCX is now working with cybersecurity experts, law enforcement, and a partner exchange to freeze and hopefully recover stolen assets. Plans are also underway to launch a bug bounty program to identify and patch vulnerabilities in its systems.
CoinDCX’s restrictive withdrawal framework has which requires users to pass internal risk assessments, is overly opaque. Gupta has defended the policy, citing anti-money laundering (AML) compliance.
“Crypto withdrawals aren’t default-enabled to prevent illicit fund movement. We enable them after enhanced due diligence,” Gupta explained during a Reddit AMA in May.
Comparisons to WazirX and Concerns Over Attribution
The breach comes almost exactly one year after a $230 million hack on WazirX, formerly India’s largest crypto exchange, widely attributed to North Korea’s Lazarus Group.
While no entity has claimed responsibility for the CoinDCX attack, cybersecurity experts are not ruling out state-sponsored involvement.
Rashmi Deshpande, a cybersecurity analyst says “The timing and scale suggest a coordinated effort, but attribution requires deeper forensics.”
Vivek Shah, a chartered accountant and crypto forensic auditor, called for stronger global regulatory standards.
“It is time for a global regulation and legal framework to protect customers and investors’ funds. Centralized crypto exchanges must invest much more in cybersecurity—on par with traditional financial institutions.”
Vivek Shah
CoinDCX has pledged to absorb the entire loss through its reserves.
However, questions remain about the adequacy of its financial safeguards.
Industry Reactions
The crypto community was divided in response. While some applaud the exchange’s quick acknowledgment and commitment to covering losses, others question the delay in action and vulnerability.
“Exchanges must prioritize real-time monitoring over post-hack damage control. The 17-hour gap is unacceptable,” said Nischal Shetty, founder of rival blockchain platform Shardeum, speaking to CoinDesk.
As of now, CoinDCX continues to operate normally, with no interruption to trading. The exchange has not confirmed whether it has filed reports with regulatory authorities or involved law enforcement in the investigation.
The breach underscores the growing threat of cyberattacks on centralized crypto platforms and renews calls for industry-wide standards in cybersecurity and incident disclosure. CoinDCX’s ability to manage recovery, rebuild trust, and reinforce its defenses will be closely watched in the coming weeks.
This whole incident serves as a reminder of the persistent risks associated with digital asset platforms, even the most prominent ones.
Sumit Gupta, the CoinDCX co-founder and CEO announced a Recovery Bounty Program. The program offers up to 25% of any recovered funds to those who can help trace the stolen crypto.
