The WazirX team, led by co-founder Nischal Shetty, recently held a virtual townhall meeting with members of the media to provide updates on the ongoing situation. Shetty revealed to Gadgets360 that users in urgent need of funds have started withdrawing their Indian Rupee (INR) balances from the platform. Initially, there was a surge in withdrawals following the unfreezing of 66 percent of users’ INR balances on August 26. However, the momentum has since slowed down.
Despite the slowdown, the WazirX team is advising users to retrieve their INR balances from the platform while financial restructuring efforts are underway. The platform has been facing challenges ever since a multi-signature wallet belonging to WazirX, under the oversight of Liminal Custody, was hacked, resulting in a loss of over $230 million.
In an effort to recover and reorganize, WazirX has partnered with a financial restructuring firm called Kroll in Singapore. George Gwee, a director at Kroll, mentioned to the media that around 43 percent of users’ funds on WazirX may not be recoverable. However, in the best-case scenario, users could potentially retrieve up to 57 percent of their deposits.
Moreover, WazirX has filed for a mortarium in a Singapore court to buy time to analyze its liabilities and reorganize its capital. It could take up to six months before a restructuring scheme is finalized by the exchange. As of now, the company has not provided a definite timeline for when crypto withdrawals will resume on the platform.
Shetty emphasized that the WazirX team has been in constant communication with relevant authorities to investigate the hack incident. While he refrained from sharing specific details, he mentioned that they have been cooperative with the authorities in identifying those responsible for the attack.
However, the team avoided questions regarding their relationship with Binance, deeming the details as confidential. There have been conflicting statements regarding Binance’s acquisition of WazirX in the past, with former Binance CEO Changpeng Zhao indicating that the acquisition was never completed. WazirX, on the other hand, accused Binance of spreading false information against them in the market.
The ongoing investigation and financial restructuring efforts are critical for WazirX to regain trust and stability among its users. The advice for users to withdraw their INR balances and the collaboration with Kroll signify a proactive approach towards recovering from the recent setback. Transparency and effective communication will be key in rebuilding confidence in the platform moving forward.
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