The recent virtual townhall held by WazirX co-founder Nischal Shetty shed light on the urgent need for users to withdraw their Indian Rupee (INR) balances from the platform. Following the unfreezing of 66 percent of users’ balances on August 26, there was initially a surge in withdrawals. However, this momentum has since slowed down, but the WazirX team continues to advise users to retrieve their funds while financial restructuring efforts are ongoing.
On July 18, a multi-signature wallet belonging to WazirX fell victim to a massive hack, resulting in a loss of over $230 million. This incident not only caused financial distress for users but also led to the suspension of trading, withdrawals, and deposit services. Currently, crypto withdrawals remain suspended, and 34 percent of users’ INR funds are still frozen pending the conclusion of the investigation.
In an effort to get back on track, WazirX has teamed up with financial restructuring firm, Kroll, in Singapore. Kroll director George Gwee has suggested that users may only be able to recover around 43 percent of their funds. The best-case scenario predicts that users could potentially retrieve up to 57 percent of their deposits. WazirX has filed for a mortarium in a Singapore court to buy time for analysing liabilities and reorganising capital. However, a definitive timeline for the resumption of crypto withdrawals on the platform has not been provided.
Despite the challenges, WazirX remains in constant communication with relevant authorities to investigate the hack. While details of these discussions remain confidential, Shetty mentions that the exchange has been cooperative in helping identify those responsible for the attack. However, questions regarding the relationship between WazirX and Binance were evaded, with the team deeming such information as ‘confidential’. Binance had previously claimed to have acquired WazirX, but disputes arose when former Binance CEO Changpeng Zhao stated that the transaction was never completed. This led to accusations of spreading false information against WazirX in the market.
WazirX finds itself in a precarious situation following the massive hack and subsequent financial turmoil. As efforts towards recovery and restructuring continue, users are urged to be cautious and follow the recommendations provided by the exchange. The future of WazirX remains uncertain, with the hope that transparency and cooperation with authorities will lead to a resolution that benefits all stakeholders involved.
Leave a Reply