What happens to users’ funds on CoinDCX as security breach wiped out $44 million from the platform?

By | July 21, 2025
CoinDCX $44 million security breach logo with shield representing user fund protection

India’s crypto community was recently shaken after CoinDCX, a major exchange, reported a $44 million loss due to a security breach. Although the attack was serious, users’ funds are completely safe, according to the company.

What Happened?

The attack hit one of CoinDCX’s internal operational accounts. This account helps manage liquidity on a partner exchange. Hackers used it to transfer crypto assets out of the platform.

This account did not store customer funds. It was only used for internal operations like trading and liquidity. Once the team noticed the breach, they moved quickly to cut off access and limit further damage.

The Amount Lost

The hackers stole $44.2 million, which equals about ₹378 crore. They moved the funds across networks like Ethereum and Solana. These cross-chain transfers helped hide the digital trail.

Cybersecurity firm PeckShield confirmed that the attackers used decentralized exchanges and mixers. These tools made it harder to trace the stolen assets.

Are Customer Funds Safe?

Yes—your money is safe.

CoinDCX uses cold wallets to store customer funds. These wallets stay offline and don’t interact with daily operations. The hackers didn’t touch them.

The breach affected only CoinDCX’s own account, not the users’. The company will cover the entire loss from its own treasury. Customers won’t lose any money.

Trading and Withdrawals Continue

Despite the breach, CoinDCX kept trading services and INR transactions running. They paused Web3 trading briefly to review systems, but most operations worked as usual.

CoinDCX also updated its withdrawal rules for added safety:

  • Withdrawals under ₹5 lakhs process within 5 hours.
  • Larger amounts may take up to 72 hours.

This delay gives the team time to review each request and keep funds secure.

CoinDCX’s Response

The company responded fast and took clear action:

  • It shut down access to the affected system.
  • Cybersecurity experts began a deep investigation.
  • India’s CERT-In (Computer Emergency Response Team) joined the review.
  • CoinDCX will launch a bug bounty program to find more security gaps.

The team published an official blog post promising better protection and full transparency going forward.

The Bigger Picture: Crypto Security Risks

This event highlights the risks facing crypto exchanges today. It comes less than a year after WazirX, another Indian exchange, lost $230 million in a similar breach.

Hackers are targeting centralized platforms because of their liquidity and transaction volume. That makes strong security not just important, but critical.

Industry experts say exchanges need to tighten protocols, monitor internal systems, and prepare for advanced attacks. The CoinDCX breach shows how quickly things can escalate.

What This Means for You

Here’s what you should know:

  • Your funds are safe on CoinDCX, even after this breach.
  • The company is covering the losses from its own funds.
  • You can still trade, deposit, and withdraw on the platform.

This is also a good time to boost your own security:

  • Turn on two-factor authentication (2FA).
  • Use strong, unique passwords.
  • Consider using hardware wallets for long-term storage.

These small steps can help protect your crypto investments from future threats.

Regulatory Impact

India still lacks clear crypto regulations. Incidents like this may push lawmakers to act. More rules could help ensure exchanges meet security standards and protect users better.

Many investors are now calling for mandatory audits, security certifications, and regular reporting. A legal framework would also make recovery easier in case of future breaches.

What’s Next for CoinDCX?

The road ahead will be challenging, but CoinDCX has taken a proactive and transparent approach. They acted fast, informed the public, and committed to absorbing the loss.

These steps show that the company values its users and reputation. CoinDCX plans to:

  • Improve its internal systems.
  • Audit third-party risks more often.
  • Work with cybersecurity firms to track the stolen funds.

If done well, these efforts could strengthen trust and help the platform grow beyond this setback.

Final Thoughts

The $44 million breach is a major event in India’s crypto history. But CoinDCX’s response shows how responsible platforms can protect their users, even during a crisis.

For investors, this event is a wake-up call and a relief. While the threat is real, strong systems and transparency can limit the damage.

As crypto adoption grows, so must the industry’s commitment to security. And in this case, CoinDCX is showing others how to respond the right way.