CoinDCX confirms $16 million loss from retired wallets

Indian cryptocurrency exchange CoinDCX has confirmed the loss of 15.99 million USDT following a failure in its automated wallet-sweeping service. The incident involved funds accumulating in deprecated wallet infrastructure that had been retired after a separate security breach in July 2025.

According to the exchange, some users continued to deposit funds into these old addresses. While CoinDCX credited these deposits to user accounts, the automated system designed to move those funds into secure, active wallets failed to operate for an undisclosed period. This allowed the assets to remain in vulnerable, compromised addresses where they were eventually drained.

The disclosure follows several days of controversy after CEO Sumit Gupta initially dismissed reports of the theft as a ‘false alarm’ and characterized the activity as the reuse of old, compromised wallets. On-chain investigators, including ZachXBT, challenged this narrative, noting that some of the allegedly retired addresses had shown recent activity.

CoinDCX stated that it will absorb the total loss from its own corporate reserves and emphasized that active trading systems, customer balances, and cold storage remain unaffected. Tether has reportedly frozen approximately $2.21 million of the implicated funds.