Indian crypto exchange WazirX is in the news once again. In the aftermath of the high-profile cyber attack last July 18 that precipitated large-scale disruptions, WazirX accelerated the INR withdrawal for its users. While many can now access their INR balance, their ability to trade crypto remains suspended, with users reportedly being informed that they would have to wait six months. Needless to say, this has frustrated and beggared many as to what may happen next. Now, let’s deep dive into what exactly happens with WazirX, recent updates, and what that means for the users.
WazirX Accelerates INR Withdrawals
WazirX recently announced that it has expedited INR withdrawals, allowing users to withdraw up to 66% of their balances. The same was set to be available by September 9, but the platform now fast-tracks the procedure. Following the 18 July cyberattack, wherein more than $230 million in cryptocurrency were stolen, crypto trading is very much a long wait for users.
This update in INR withdrawal comes from WazirX via social media platform X, earlier named Twitter. According to the exchange, all eligible users could now access the funds up to 66% of their limit. This faster timeline is targeted at giving quicker relief to the people affected by the hacking incident.
Why was WazirX hacked?
WazirX suffered a cyberattack on July 18, 2023, which cost them an enormous number of cryptocurrencies. They had rounded up more than $230 million worth of cryptocurrency on the platform, which hackers managed to steal. It laid grounds for restructuring the operations of WazirX concerning the withdrawal of INR and crypto trading. WazirX resorted to protection in Singapore from the fallout of the situation that arose.
WazirX
WazirX’s Legal Move: Seeking Protection in Singapore
Following the hack, WazirX filed for a moratorium with Singapore’s High Court. This was in line with the Insolvency, Restructuring, and Dissolution Act. The legal move will afford WazirX a 30-day relief period in which it will reorganize its financial liabilities. By this, WazirX hopes to come up with a scheme that could help the company manage its debts while offering some stability to its users.
While the above litigation is still in process, the users have temporary relief for INR withdrawals, but the bigger issue regarding crypto trading seems to be still pending.
6-Month Delay for Crypto Trading
The worst news for crypto traders on WazirX is that there’s still quite a road to tread. WazirX had said during a virtual town hall meeting that crypto trading would not resume anytime soon, at least for the next six months. This led to an outrage among its users, most of whom were itching to get back into the action or at least access their funds in crypto.
The exchange explained that this 6-month-long delay is required to sort out and rectify the issues that have developed post-hack, but due to improper explanation at the town hall, many are frustrated. According to user Budhil Vyas, who shared his summary of the meeting on X, WazirX did not give enough clarity regarding when the crypto trading would go live again.
User Frustration Grows: Lack of Transparency from WazirX
Many left the town hall meeting more confused than reassured. Comments were disabled during the event, and WazirX asked all their users to send questions via email. Fairly suspect, since they weren’t into direct communication. Quite a few of them did have urgent questions related to crypto funds, to which they didn’t get any concrete response from WazirX in that session.
Vyas also said that if asked about the resumption of crypto trading, WazirX would have none but a mere reiteration of the fact that it would at least take six months. That vagueness continued to mount frustration in users. Second, the decision by WazirX not to let the legal costs lie with the platform means several users remain in the dark about why they may have to bear an additional financial load.
Suspicion Over Moved Funds: $6.3 Million Transferred
To further add to the mystery, a report came in that $6.3 million of the WazirX hack was transferred to Tornado Cash, a popular cryptocurrency mixing service used in many cases of money laundering. Coincidence or not, this transfer just fell right during the timing of the town hall and has created suspicion. This raises a question among users if there is more to WazirX shelving money than meets the eye.
What’s in Store for WazirX Users?
In fact, the situation at WazirX still remains unclear. Though fast-tracking INR withdrawal is some relief, the very prolonged delay in crypto trading has irritated many users. For now, those planning to trade or withdraw their crypto assets will have to wait for at least six months.
While WazirX is restructuring, it is really important that users be in the know and observe the updates on the platform. Lousy communication without or with clear pretexts, added to these movements of funds, has raised much uncertainty in recent times, yet the exchange has repeated that they are seeking a solution.
Conclusion
While WazirX is getting its house in order, it is not sure which way the road will actually go. The fact that INR withdrawals have been accelerated is quite a step in the right direction, but the continuous delay in crypto trading just raises more questions. The platform needs to communicate clearly and be transparent if it is ever looking to regain user trust.
For now, users should be ready for the six-month wait, with an eye toward associated development in the near future. Time will tell whether WazirX will ever be able to recover fully from the crisis and gain back user trust.
