(This article is reprinted from Crypto City. The author is Sean. The original title is "Surrender and lose half? WazirX exchange proposed a compensation plan after being hacked. Users can only choose "cruel 2 to choose 1"")
After WazirX suffered a hacker attack, on July 27, it proposed a recovery plan called "Social Loss Strategy", but no matter which one you choose, it is equivalent to letting users face the losses of hacker attacks themselves.
(Indian exchange WazirX reported that US$200 million was stolen)
WazirX exchange was hacked
On July 18, WazirX, India’s largest cryptocurrency exchange, suffered a hacker attack. During the attack, hackers stole a variety of cryptocurrencies including Shiba Inu ($SHIB), Ethereum ($ETH), Polygon ($MATIC), etc. Cryptocurrencies, with a total value of more than $235 million, account for almost 50% of the exchange’s total holdings value.
After the incident, WazirX immediately announced the suspension and freezing of all cryptocurrency and fiat currency (Indian rupee) withdrawals, resulting in users being unable to immediately withdraw their assets. This incident affected up to 45% of user funds, detailed Please refer to the following report for the incident.
(Are they all North Korean hackers? Elliptic analyzed that WazirX was attacked by North Korean hackers, and so was DMM’s $300 million recently?)
Social Loss Strategy: User Cruelty 2 Pick 1
In response to this crisis, WazirX Exchange chose to propose a recovery plan called "Socialized Loss Strategy" on July 27, with the intention of allocating losses to users to maintain the stability of the platform.
Source: WazirX
According to the plan, users must choose one of two options, but no matter which one they choose, it is equivalent to letting users, not the platform, face the losses of hacker attacks. This has also become the most controversial aspect of this incident. part:
Option A: Freeze 45% of assets. Users can continue to use the remaining 55% of assets to conduct transactions and deposits on the platform, but "restrict withdrawals." Users who choose this option will be compensated after the subsequent exchange assets are restored. priority.
Option B: Freeze 45% of assets. Users can continue to withdraw the remaining 55% of assets in a "staggered manner", but after the subsequent exchange assets are restored, they will have a lower priority in compensation.
No matter which option is chosen, the user is directly locked in 45% of the assets. Only when the company successfully recovers the stolen funds will the user be compensated, and the compensation will still be based on the price on the night of July 21. Netizens The taunt is "Surrender and lose half."
Community reaction and criticism
Unsurprisingly, the announcement of WazirX triggered a strong backlash from the community. Many users believed that this was a great disregard for the security of their assets. They were also dissatisfied with WazirX’s behavior of letting users take responsibility. Co-founder and CEO of CoinDCX Sumit Gupta criticized WazirX on X:
The burden of losses should be borne primarily by WazirX itself, utilizing its own coffers and assets, rather than having customers shoulder 45% of losses.
Source: Sumit Gupta
At the same time, some users also questioned the authenticity of the attack and called for a legal investigation into WazirX and its leader Nischal Shetty to determine whether the incident was the result of hackers or insider planning.
Faced with such pressure, Nischal Shetty, the head of WazirX, emphasized in the X statement on July 29 that this poll is only a preliminary step to collect user opinions and is not legally binding. He also said that the team will decide the next course of action based on the feedback received.
Source: Nischal Shetty
Is this article shared by tens of millions of users? Follow-up to the WazirX exchange hack: Users can only “cruelly choose one of the two” first appeared on Chain News ABMedia.
