CoinDCX attributes $16 million crypto outflow to failed sweep of retired wallets

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CoinDCX $16M wallet outflow

Highlights

CoinDCX attributes $16 million outflow on Wednesday to a failed sweep of deprecated wallets compromised after its July 2025 $44 million exploit.
CEO Sumit Gupta calls recent wallet activity a false alarm, stating that compromised addresses created in January 2025 are not part of current operations.
On-chain investigator ZachXBT disputes the exchange's explanation, noting at least one affected address was still active, raising concerns over CoinDCX's security controls.

Disputed wallet activity and company response

As reported by CoinDesk, CoinDCX says the transactions stem from wallet addresses created in January 2025 that were compromised after the exchange's July 2025 exploit and later retired from use.

A CoinDCX spokesperson says the addresses mentioned in recent claims have no connection to the exchange's current operations, adding that central and user addresses now in use have not been impacted. The exchange's position is that hackers from the earlier breach are reusing abandoned addresses, creating what CEO Sumit Gupta describes on X as a false alarm.

The latest concern emerged after an X user, Darcy, highlighted large outflows on Wednesday from a CoinDCX hot wallet and several deposit addresses. The transfers totaled about $16 million in USDT and Tron token TRX, with the largest single transaction amounting to 15,819,002 USDT before the funds were split across several wallets.

Operational lapse raises questions for exchange security

CoinDCX says some users continued to send funds to deprecated deposit addresses despite earlier notifications issued after the July 2025 hack. The exchange says its automated sweeping process, which is supposed to move such deposits into wallets under its control, failed for a period and allowed the outflows to occur.

That explanation has drawn scrutiny from on-chain investigator ZachXBT, who says at least one of the addresses in question was still active. CoinDCX maintains that customer assets are held in cold wallets, that current addresses were not compromised, and that trading continues as usual.

The episode revives attention on the exchange's controls after CoinDCX was exploited for about $44 million in July 2025. For the broader crypto sector in India, the dispute underscores how address management, wallet retirement procedures and deposit sweep systems remain critical operational risks even when exchanges say core reserves are segregated.

We previously reported on CTOS Digital Bhd’s cybersecurity incident and the company’s estimate that the disruption could cut net profit by RM12 million and revenue by RM16 million if some services remained unavailable until the third week of October. Our earlier coverage also noted that analysts warned a longer recovery could raise costs and weigh on customer confidence, with additional weeks of disruption potentially extending the financial hit.

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