BENGALURU: Users of crypto exchange WazirX, which was hacked in July resulting in the theft of digital assets worth above Rs 2,000 crore, may not receive their funds in full.
In a virtual conference on Monday, George Gwee, director, restructuring, Kroll and Jason Kardachi, MD, Kroll (financial advisor for WazirX), explained the current situation of the exchange. As per legal advisors, customers will get a return of 55-57% of the funds.
This means, 43% of the money may not be recovered. Founder and CEO Nischal Shetty said they are in negotiation and in ideation stage, and not in a position to say much.
The exchange has an ownership dispute with Binance. While Zanmai India operates WazirX, Zettai is Singapore-incorporated, and it has applied for a moratorium in Singapore court. WazirX is pursuing a restructuring of crypto balances that will take at least six months, and as part of the restructuring, it aims to engage with a white knight to provide capital and pursue partnerships and collaborations.
The cyberattack on July 18 resulted in a large volume of ERC-20 tokens being stolen. Last month, Google subsidiary Mandiant Solutions provided a clean chit to the exchange, but digital assets security firm Liminal Custody questioned the scope and methodology of the audit. Shetty told TNIE. “It’s just three laptops that we used for accessing the liminal website. Our infrastructure was not impacted or involved in this process. We gave the entire laptop image and data to the forensic team, we have even provided this to the right authorities.”
He added that there is nothing beyond the laptop image that exists with us since nothing else on our end was used for accessing the Liminal website except these three laptops. The exchange said tracking and recovering of stolen crypto assets are a top priority.
Legal advisors explained that restructuring is not insolvency, liquidation or bankruptcy. It is a plan to distribute assets to users in a pro-rata, equitable way, and in crypto (not fiat); and that it allows users who need liquidity urgently to withdraw crypto and not exit the restructuring.