The aftermath of the $234 million hack on the crypto platform WazirX has taken a dramatic turn as the platform enters a 30-day moratorium pending a decision by Singapore’s High Court. This move comes as rival platform CoinSwitch announced its intention to pursue legal action to recover approximately $9.6 million in digital assets trapped on WazirX’s exchange. Zettai Pte, the Singapore-incorporated company behind WazirX’s operations, filed for the moratorium triggering an automatic 30-day freeze to allow the company time to draft a restructuring plan.
CoinSwitch, in an Aug. 28 social media thread, expressed frustration over the lack of clarity from WazirX regarding a full recovery plan for the trapped funds. The company stated that it had substantial assets, including fiat currency, ERC20 tokens, and other digital assets, stuck on WazirX’s platform following the hack. Despite multiple attempts to resolve the issue, CoinSwitch has been unable to recover the funds and has therefore decided to pursue legal action to recover them.
WazirX, on the other hand, explained that under the planned restructuring, the impact of the hack would be distributed among users. Users would receive a share of the available token assets proportional to their account balances. Co-founder and CEO Nischal Shetty emphasized that the timeline for restructuring depends on how quickly the firm and its creditors can agree on a path forward. Collaboration and support from stakeholders are deemed crucial for the success of the restructuring plan.
Despite the looming legal battle, CoinSwitch assured its users that the affected funds represent less than 1% of its total assets. The platform is using its treasury reserves to maintain a 1:1 ratio for user holdings. Shetty, on behalf of WazirX, remains unfazed by the potential lawsuit and promised that all users will be treated fairly, regardless of the size of their claims.
The aftermath of the WazirX hack has not only raised concerns about the security of crypto platforms but has also sparked a legal battle between rival platforms. The outcome of the legal proceedings and the effectiveness of the restructuring plan will determine the future of WazirX and its users. Collaboration, transparency, and fair treatment of all parties involved will be key in resolving this crisis in the crypto space.
