WazirX, a troubled crypto platform, has recently announced that it is entering a 30-day moratorium following a massive $234 million hack that occurred in July. The decision is pending approval by Singapore’s High Court on whether to grant an extension to this moratorium. This news comes as rival platform CoinSwitch has also expressed its intention to take legal action to recover around $9.6 million in digital assets that are currently trapped on WazirX’s exchange.
The Singapore-incorporated company Zettai Pte, which operates WazirX, filed for the moratorium on August 27th, triggering an automatic freeze for 30 days. This freeze will allow the company to draft a restructuring plan, which is estimated to take at least six months to finalize. The firm aims to collaborate with stakeholders and ensure that users’ crypto balances are addressed while working towards recovering the lost funds. WazirX intends to distribute the impact of the hack among users, providing them with a share of available token assets based on their account balances.
Nischal Shetty, the co-founder and CEO of WazirX, emphasized the importance of unity in the restructuring process. He mentioned that the timeline for restructuring depends on how quickly the firm and its creditors can agree on a path forward. Shetty highlighted the significance of support and collaboration from users, stating that their involvement is crucial to the success of the restructuring efforts.
CoinSwitch, another crypto platform affected by the WazirX hack, has substantial assets, including fiat currency and digital tokens, stuck on WazirX’s platform. Despite multiple attempts to resolve the issue and recover the funds, CoinSwitch has been unsuccessful. The company expressed frustration over the lack of clarity from WazirX regarding a full recovery plan and announced its decision to pursue legal action to recover the trapped funds.
Despite the looming legal battles and ongoing challenges, WazirX and CoinSwitch are committed to treating their users fairly. CoinSwitch assured its users that the affected funds represent a small fraction of its total assets and that it is using treasury reserves to maintain a 1:1 ratio for user holdings. Shetty remains confident that all users will receive fair treatment, regardless of the size of their claims.