Liminal Pushes Back on Delhi Police’s Non-Compliance Claims in $230M WazirX Hack Case

In the wake of the massive WazirX hack earlier this year, which saw approximately $230 million in digital assets stolen, recent developments have brought a suspect into custody. With the investigation intensifying, the Delhi Police recently accused Liminal Custody, the digital custody provider for WazirX, of non-compliance in the probe. Liminal has since responded, emphasizing its commitment to cooperation and regulatory transparency.

Summary of the Hack and Recent Arrest

The WazirX hack in July 2024 targeted a multisignature wallet managed in collaboration with Liminal, resulting in one of the most significant breaches in the Indian crypto landscape. On November 14, authorities made a breakthrough by arresting SK Masud Alam, a suspect from West Bengal accused of creating a fraudulent account that allegedly facilitated the hack. This arrest marks an important step for the investigation as authorities look to untangle the web of transactions connected to the breach.

However, as the investigation deepens, accusations from the Delhi Police have surfaced, suggesting Liminal’s lack of compliance during the investigation. This claim led Liminal to publicly address the issue, asserting its cooperative efforts and adherence to regulatory guidelines.

Liminal’s Detailed Response to Non-Compliance Allegations

In a formal statement, Liminal clarified its stance on the compliance accusations, firmly disputing any insinuations of non-cooperation. Liminal explained, “Contrary to the media reports, we would like to clarify that Liminal has not only submitted their reply to the authorities but has also officially met with IFSO officials to help them with our best efforts despite the territorial limitations of data sharing.”

The custody provider highlighted that it has proactively engaged with the authorities and has no indication from them regarding any non-cooperation issues. Liminal stated that the firm’s ongoing engagement with the Delhi Police is part of a broader commitment to regulatory transparency, saying, “Liminal’s dedication to regulatory compliance and transparent operation remains a cornerstone of our business practices. We will continue to collaborate fully with relevant authorities while adhering to all legal and jurisdictional requirements governing our operations in India, Singapore, and other territories globally.”

Liminal also emphasized that media reports should not be taken at face value, cautioning the community to avoid drawing conclusions from inference-based stories. The company underscored that “the investigations with all parties are still ongoing, and it is extremely premature to arrive at any conclusions at this stage.” They urged stakeholders to consider the ongoing nature of the investigation and to avoid forming opinions prematurely based on unconfirmed reports.

A Frustrating Blame Game

For WazirX users, this ongoing blame game between WazirX, Liminal, and now the Delhi Police is frustrating. During a bull market, when users are eager to focus on growth opportunities, the prolonged uncertainty stemming from internal conflicts and accusations diverts attention from user needs and security improvements. While Liminal insists on its cooperative stance, users are left watching as these parties struggle to coordinate, hoping for a resolution that prioritizes transparency, security, and swift action in the interest of all stakeholders.

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