Remember the $230 million WazirX hack? Here’s an interesting update from its legal team.
WazirX announced on August 8 that it would undo all trades made after July 18, when withdrawals were halted. Customers will have their accounts restored to their pre-July 18 state. However, here’s what the lawyers have to say.
It’s highly unlikely they will recover the full value of their cryptocurrency holdings following the exchange’s recent hack, according to legal advisers.
In a recent conference call that included WazirX co-founder Nischal Shetty, experts revealed that customers stand to lose at least 43% of their assets. George Gwee, a director at restructuring firm Kroll, indicated that the best-case scenario might see a return of 55% to 57% of the lost funds.
The situation is set to be addressed in the Singapore High Court on Tuesday, where WazirX will request six months of protection while it attempts to restructure its liabilities. The exchange, operated by Zanmai India and incorporated in Singapore through Zettai, lost $234 million—equivalent to about 45% of customer funds—in a July hack.
Shetty acknowledged that these figures are up-to-date as of Monday and emphasized that efforts are ongoing to minimize the shortfall.
Over the next several weeks, it will be easier and clearer on each stage where we can fill the gap.”
Kroll managing director Jason Kardachi warned that unless a “white knight” investor or other recovery options emerge, it’s unrealistic to expect customers to be fully compensated in cryptocurrency terms. “Given that nearly half of the crypto has been compromised, making everyone whole seems out of reach,” he noted.
Should the crypto market improve, there might be some relief in dollar terms, though Kardachi tempered expectations by saying that neither increased profitability nor potential cash infusions are likely to fill the existing gap.
As per crypto trending news, the ongoing ownership dispute between WazirX and Binance, the world’s largest crypto exchange, further complicates matters. While confidentiality agreements prevent details from being disclosed, Kardachi did mention that 55% of the funds might be available even before the dispute is resolved.
