Unocoin Halts Withdrawals Amid Suspect Wallet Transfers

Indian cryptocurrency exchange Unocoin has kept deposits and withdrawals suspended as it investigates whether suspicious transfers from wallets linked to custodian BitGo were executed using a wallet recovery feature, according to Cointelegraph.

On Friday, the exchange stated that BitGo had frozen Unocoin's enterprise account on Nov. 6 at the exchange's request, and that the freeze functioned as intended. However, Unocoin reported that the transactions under investigation were signed and broadcast outside BitGo's platform.

Recovery Feature Investigation

BitGo's multisignature wallets include a recovery feature that permits wallet holders to access funds if BitGo becomes unavailable. Unocoin suspects this feature was misused, though the exchange has not yet established how the transfers occurred or whether any digital assets were lost.

Unocoin first detected unauthorized activity on Nov. 6 and subsequently suspended all services on Monday after identifying further activity. On Thursday, the exchange disclosed outgoing transactions from an Ethereum address within its BitGo wallet infrastructure and reported that its servers had been compromised.

Restoration Timeline Unannounced

The exchange has not announced a specific date for restoring services. Neither Unocoin nor BitGo responded to requests for more information prior to publication.

Key facts

• Unocoin suspended deposits and withdrawals due to suspicious transfers.
• BitGo froze Unocoin's enterprise account on Nov. 6 at the exchange's request.
• Unocoin suspects the misuse of a wallet recovery feature on BitGo multisignature wallets.
• The exchange reported outgoing transactions from an Ethereum address in its BitGo wallet infrastructure and compromised servers.