Indian crypto exchange WazirX has unveiled a plan to recover user funds following a significant cyberattack that resulted in the theft of around $230 million.
The hack, affecting 45% of user funds, has led WazirX to implement a socialized loss strategy to minimize disruption and ensure platform stability.
To manage the loss, WazirX has introduced a 55/45 approach.
This means that users can immediately access 55% of their assets, while the remaining 45% will be held in Tether-equivalent tokens.
This method aims to distribute the impact evenly among users, avoiding the typical uncertainty and prolonged recovery periods seen in similar incidents.
By doing so, WazirX seeks to offer a more expedited and flexible resolution.
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Users are provided with two options for handling their remaining assets, each with distinct advantages.
Detailed instructions will be sent to registered users via email, with a deadline of August 3, 2024, at 7:00 am IST for responses.
The outcome of this user poll, though not legally binding, along with ongoing investigations and the exchange’s liquidity, will shape the final decision.
In an effort to ensure fair treatment, WazirX plans to create a diversified portfolio for the unlocked 55% of users’ assets.
This portfolio will include a range of crypto assets, replacing any affected tokens with unaffected ones to maintain balance.
The valuation of these unlocked assets will be based on average prices from CoinMarketCap and selected global exchanges as of July 21, 2024, at 8:30 pm IST.
Operations are expected to resume after users have completed the poll to select their preferred asset management option.
The breach at WazirX, resulting in approximately $235 million in losses, ranks as the second-largest hack of a centralized exchange in recent times, following a $305 million loss from the DMM exploit on May 31.
The exchange is committed to recovering from this setback and maintaining trust with its user base through transparent and equitable measures.
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