Hacked Exchange WazirX attacks “entities” for delaying its restructuring efforts

Key Takeaways

•  WazirX  stated that certain entities want to complicate the resolution efforts that the exchange has been pursuing since it was hacked.
• Users will now be allowed to withdraw up to half of the 66% withdrawal limit between August 26 and September 8, 

Indian cryptocurrency exchange WazirX has raised concerns about external interference that it claims is hindering its recovery process after the $234 Million exploit. The exchange’s criticism came in the wake of its announcement of a comprehensive restructuring plan designed to stabilize its finances and bolster the security of its users’ assets.

In a statement posted on social media platform X, WazirX accused unnamed external parties of deliberately trying to prolong the restructuring process. The exchange suggested that these entities want to maintain uncertainty and complicate the resolution efforts that WazirX has been pursuing since it was hacked.

“It is regrettable that some are trying to exploit this situation for their own engagement. We encourage everyone to focus on achieving the most effective and quick resolution, which is through restructuring”, the crypto exchange’s post on X(formerly Twitter) reads

 On July 18, hackers gained access to around $234 million, or about 45% of the total funds held by investors, through WazirX’s Safe Multisig wallet on Ethereum.

As part of its recovery efforts, WazirX is rolling out a phased plan to restore Indian rupee (INR) withdrawals, which will start gradually from Monday, August 26.

The exchange announced on August 23 that users will be allowed to withdraw up to half of the 66% withdrawal limit between August 26 and September 8, with the remaining amount available from September 9 to September 22. To ease the financial burden on its users, WazirX is also reducing withdrawal fees by 60%.

WazirX is taking legal steps in Singapore, choosing this jurisdiction for its legal restructuring process. The company has opted for a scheme of arrangements, which has received court approval. This legal framework allows WazirX to negotiate fair terms for everyone affected by the hack, ensuring that the distribution of assets meets legal standards.

The exchange has pointed to a shortage of token assets “due to the cyberattack” and the loss of a significant amount of ERC-20 tokens. However, WazirX has not specified a timeline for when users will be able to withdraw their crypto balances from the platform.

The ongoing investigations by various law enforcement agencies have led to 34% of INR balances being “frozen and not immediately available for withdrawal.” Despite these hurdles, WazirX emphasized that its parent company, Zanmai, is not under investigation regarding the frozen INR balances.

Around 45% of the users on the platform were impacted by the hack. Crypto storage provider Liminal Custody stated its preliminary probe show that one of the self-custody multi-sig smart contract wallets created outside of the Liminal ecosystem has been compromised resulting in the exploit. As per blockchain security firm Elliptic, North Korean hackers were likely behind the exploit.