Indian crypto exchange WazirX to restructure after $230 million hack

What’s new? The team at Indian crypto exchange WazirX announced a restructuring, calling it the most expedient and legally sound approach to address the problems caused by the $230 million hack last month. WazirX said the restructuring is in the best interest of its users and will allow the platform to continue operating.

Source: X.com

What else is known? Along with this, the exchange team accused unnamed third parties not among the investors of attempting to obstruct the restructuring for their own personal interests. “Their intention appears to be maintaining uncertainty rather than finding a resolution,” the company said.

WazirX emphasized that it intends to recover as much user funds as possible and explore ways to raise additional capital. The company has also launched a rewards program to help recover stolen assets and has reached out to lawyers.

The exchange will provide more details on the restructuring next week. Users have been assured that this does not involve bankruptcy or liquidation, which would take several years and would not allow for prompt payment of compensation.

On July 18, a private key compromise resulted in the withdrawal of $230 million in cryptocurrencies from the exchange’s wallet. Three days later, the team reported that they could not maintain 100% asset security, and WazirX was suspended.

Then SlowMist analysts allowed the possibility that behind the hack is a hacker group Lazarus from North Korea, involved in the financing of the government’s program to create weapons of mass destruction. This circumstance excludes the possibility of voluntary return of funds and makes it difficult to recover them.

WazirX announced last week that it would resume phased withdrawals in Indian rupees from August 26. Zanmai Labs, the company responsible for rupee transactions on the platform, has not been affected by the hack and has sufficient reserves for the payments. However, due to a judicial investigation involving WazirX, 34% of the balance in Indian rupees is currently frozen.

In the first phase, which will end on September 8, users will be able to withdraw half of the 66% limit. From September 9 to September 22, the exchange will allow users to withdraw the remaining half of the available amount.

WazirX emphasized that the exchange does not have enough cryptocurrency for withdrawals at the moment.