WazirX Unveils Restructuring Plan, Leaving Users with Uncertain Future

Indian cryptocurrency exchange WazirX, which suffered a devastating hack in 2024, has proposed a restructuring plan that is sparking outrage among its users. The plan offers two options: support the creation of a new decentralized exchange (DEX) or wait for up to five years to recover their funds.

A Breakdown of the Proposed Plan

WazirX has outlined the consequences of supporting or rejecting the plan. If creditors opt for restructuring, the exchange will build its own DEX, with a potential launch date to be determined. However, if creditors reject the proposal, they will not have a clear timeline for fund recovery, and any refund will likely be in fiat, taking significantly longer than the restructuring process.

Uncertainty Surrounds the DEX Plan

While the DEX plan has a concrete date of April 2025 for a Singapore court decision, there is no clear timeline for when hack victims will actually receive their funds back. WazirX promises to share future DEX profits with creditors, but the details of the compensation plan, including the percentage and frequency of payments, remain unclear.

“If the majority of the voters choose to ‘Vote Yes’ for the Scheme, and it becomes effective, the first round of fund distribution of approximately 80-85% will happen in 10 business days.” — WazirX Spokesperson

Community Backlash

The crypto community has expressed skepticism and anger towards the proposal, with some calling it an “absolute joke.” Others have urged the WazirX executive team to sell their assets to compensate customers for their losses.

Background on the WazirX Hack

WazirX was founded in 2018 and was once one of India’s largest crypto exchanges by trading volume. However, in July 2024, the exchange lost over $234 million in multiple crypto assets due to a hack attributed to North Korea’s state-sponsored hacking group, the Lazarus Group.

Previous Attempts at Resolution

Following the hack, WazirX attempted to institute a “socialized loss strategy,” which was met with widespread outrage. The exchange has since moved its assets to new multi-signature wallets and is now proposing the DEX plan as a solution.

Tips for Affected Users

  • Stay informed about the proposed restructuring plan and its implications.
  • Understand the potential risks and benefits of supporting the DEX plan.
  • Consider seeking advice from a financial expert or lawyer.

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