‘WazirX customers unlikely to recover full funds’

WazirX customers are unlikely to recover the full value of their crypto holdings in the ongoing restructuring process, following the $234 million hack of the Indian cryptocurrency exchange in July.

That is the verdict of George Gwee speaking on Monday (Sep 2), a director at restructuring specialists Kroll, which is currently advising the company. 

He stated the best possible scenario is a return of anywhere between 55% and 57% of the missing funds.

Gwee was speaking on a conference call with journalists, with WazirX co-founder Nischal Shetty present, setting out the forecasts and the next steps following the highly damaging hack. The July incident is thought to be the largest crypto theft ever in India, with a ripple effect through the sector in the country

Singapore High Court will hear WazirX’s request for a six-month protection order on Tuesday, as the company aims to restructure and adjust its liabilities after losing assets worth $234m. The figure represents 45% of customer funds held by the exchange, underlining the extent of the cyber attack.

Zanmai India is the entity that operates WazirX, with its parent company Zettai incorporated in Singapore.

WazirX’s complicated ownership dispute with Binance

WazirX intends to issue remaining token assets to users in a pro-rata crypto arrangement with consideration given to share profits from revenue-generating products, but these were tentative soundings.

Co-founder Shetty advised the numbers are as things stand, but negotiations could lead to a reduction of the deficit. 

“Over the next several weeks, it will be easier and clearer on each stage where we can fill the gap,” he said.

On the call, WazirX confirmed capital will not be raised against equity, due to a tangled web of an ownership dispute with Binance. The world’s largest exchange has been closely entwined with the Indian platform over the years, but the current status is shrouded by acrimony and uncertainty.

Image credit: Via Ideogram

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