A wave of discontent has surged among users of WazirX, India’s largest cryptocurrency exchange, following a massive $234.9 million (approximately Rs 2000 crore) hack of its multi-sig wallet. Aggrieved customers are now calling for a Central Bureau of Investigation (CBI) inquiry into the incident. They suspect potential insider involvement and demand accountability from WazirX and its co-founder, Nischal Shetty.
Dissatisfaction with WazirX’s Response
Users have approached the DCP South Zone of the Delhi Police, expressing dissatisfaction with WazirX’s response to the hack. They argue that the platform’s recent announcement, which proposes that customers bear 40% of the losses before any recovery or compensation process begins, is neither fair nor adequate. Furthermore, they demand greater transparency, urging for a fair snapshot to be taken post-hack to ensure equitable treatment of traders who held INR during the hack but bought assets later.
Criticism of WazirX’s Handling of Funds
Criticism of WazirX’s handling of funds has been widespread. Instead of taking full responsibility, the exchange has only unlocked 55% of user funds. Consequently, users must absorb the remaining losses. This has raised significant concerns within the community. Many feel that WazirX should cover the financial shortfall from their reserves.
Also Read: WazirX Implements Fair Fund Recovery Plan Following $230M Hack
Allegations of Manipulative Practices and Insider Trading
The users’ petition highlights several critical issues. One major concern is WazirX’s perceived manipulative and unfair practices. The platform has been accused of running misleading polls that could unknowingly lead users to waive their legal claims and agree to unfavorable terms. Additionally, users allege insider trading. After the hack, WazirX insiders allegedly converted their crypto assets to INR, avoiding losses and positioning themselves to profit from the situation. Such unethical behavior has shattered customer trust and demands immediate investigation.
Misleading Deposits and Forced Asset Redistribution
Even after the hack, WazirX continued to accept INR deposits, misleading investors into thinking they could benefit from the market dip. These deposits are now locked, further worsening the financial strain on users who believed they were making prudent investments. Adding to users’ woes, WazirX plans to convert 45% of user assets to USDT. This conversion could create potential tax liabilities without clear guidance on who will bear these costs. As a result, this forced conversion has added an additional financial burden on already impacted users.
Demand for Justice and Transparency
WazirX users have made their demands clear: a comprehensive criminal investigation into the platform’s actions and justice for all affected users. They seek accountability from WazirX and Mr. Shetty, insisting on fair compensation for their losses. This incident has highlighted not only the vulnerabilities within cryptocurrency exchanges but also the need for greater transparency, accountability, and user protection in the rapidly evolving world of digital finance.
As the demand for a CBI inquiry gains momentum, the eyes of the cryptocurrency community are firmly fixed on the outcome. They hope for a resolution that upholds the integrity and trust essential for the growth of the industry.
