Indian cryptocurrency exchange Unocoin has suspended deposits and withdrawals as it investigates whether suspicious transfers were made from wallets linked to custodian BitGo using a recovery feature.
The exchange on Friday said that BitGo had frozen the exchange’s corporate account on November 6th at Unocoin’s request and that the freeze worked as intended. The transactions under investigation were signed and transferred outside of BitGo’s platform, Unocoin said.
The exchange said that BitGo’s multi-signature wallets have a recovery feature that allows wallet holders to access funds when BitGo is unavailable. Unocoin suspects the feature was abused and has yet to determine how the transfers occurred or whether digital assets were lost.
Unocoin and BiGo did not respond to Cointelegraph’s request for further information before publication.
Unocoin initially reported the unauthorized activity on November 6 and suspended all services on Monday after detecting further activity. It’s on Thursday disclosed outgoing transactions from an Ethereum address on its BitGo wallet infrastructure and said its servers had been compromised.
The exchange has not announced a date for restoring services.
A Nov. 5 alert from India’s cybersecurity agency described an AI-powered campaign that targeted crypto exchanges and other financial firms. No connection has been made to the Unocoin incident.
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