WazirX users must withdraw INR balances: Nischal Shetty
On Monday, September 2, the WazirX team, including co-founder Nischal Shetty, held a virtual town hall with members of the media. During the meeting, Shetty informed Gadgets360 that users in urgent need of funds have started withdrawing their Indian Rupee (INR) funds from the platform. Initially, after releasing 66 percent of users’ INR funds on August 26, there was an uptick in withdrawals. However, the momentum has slowed since then. Despite this, the WazirX team is advising users to withdraw their INR funds from the platform while financial restructuring efforts are underway.
On July 18, a multi-signature wallet of WazirX, overseen by Liminal Custody, suffered a massive hack, resulting in losses of over $230 million (approximately Rs. 1,900 crore). The incident caused significant financial hardship for WazirX users, worsened by the exchange’s decision to suspend trading, withdrawals, and deposit services. Currently, crypto withdrawals on the platform remain suspended and 34 percent of users’ INR funds have been frozen pending the completion of the investigation.
Speaking to Gadgets 360, Shetty said: “People have been asking us whether I should withdraw the money or keep it. We are urging everyone you know to withdraw it and when we start over, you can always deposit again.”
Meanwhile, Singapore-based Zettai has partnered with a financial restructuring firm called Kroll, which will help WazirX get its books back in order. Speaking to the media, Kroll CEO George Gwee said that users may not be able to get back about 43 percent of the funds they had on WazirX. Gwee outlined the best-case scenario for fund recovery, saying that users could get back up to 57 percent of their WazirX deposits.
Last week, WazirX filed a moratorium in a Singapore court, essentially buying time to analyze its liabilities and reorganize its capital. It could take up to six months for a restructuring plan to be finalized by the exchange.
The company has not yet provided a definitive schedule for when crypto withdrawals on the platform will resume.
Speaking to Gadgets360, Shetty said that the WazirX team is in constant contact with the relevant authorities to investigate this hack.
“I can’t go into the details of, you know, who we’re talking to, what’s happening. That said, I would say that we’ve been, you know, cooperative, and there’s been a lot of movement in terms of helping find who was responsible for this attack, and helping the authorities in whatever way they can to figure it out,” he noted.
Notably, the WazirX team dodged all questions regarding its relationship with Binance, calling the details “confidential.” Binance had claimed in November 2019 that it had acquired WazirX. However, last year, former Binance CEO Changpeng Zhao claimed that the transaction of acquiring WazirX “was never completed.” At the time, WazirX accused Binance of spreading false and misleading information against them in the marketplace.
