India’s CoinDCX said it had absorbed a $15.99 million loss after a failed internal process allowed customer deposits to accumulate in a retired cryptocurrency wallet linked to a $44 million security breach in July 2025.
The exchange said some users continued depositing funds into the old addresses despite instructions to use updated wallets. An automated service designed to transfer those deposits to its primary wallets failed for an unspecified period, resulting in the loss.
CoinDCX said its active wallets, trading systems, and customer balances were unaffected, adding that user funds remained protected in segregated cold wallets.
The disclosure followed initial denials of suspicious outflows flagged by blockchain investigators, including the popular on-chain investigator, ZachXBT, who questioned the exchange’s account of activity involving the retired addresses.
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The CEO, Sumit Gupta, had initially described the reports as a false alarm.
The incident highlights operational and security risks associated with managing legacy wallet infrastructure even after addresses have been retired following a breach. CoinDCX said it would strengthen monitoring and controls around its deprecated systems.
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