Crypto exchange WazirX to allow INR withdrawals starting August 26
What's the story
WazirX, a leading cryptocurrency exchange, will permit withdrawals of INR balances from its platform starting August 26.
However, customers will only be able to withdraw 66% of their funds. The company also plans to reduce withdrawal fees by 60%, from ₹25 to ₹10.
The decision to allow partial withdrawals follows a cyberattack on WazirX last month, which resulted in the loss of $230 million in crypto assets. This significant theft represented nearly 45% of the exchange's total holdings.
Operational stability
INR operations remain unaffected by cyberattack
Despite the cyberattack, Zanmai Labs Pvt Ltd ('Zanmai'), WazirX's operating entity for INR-related activities remains unaffected.
The company has assured that it has sufficient INR reserves to cover all user balances.
However, due to ongoing disputes and investigations by law enforcement agencies, around 34% of INR balances are currently frozen and not immediately available for withdrawal.
Legal recourse
Legal approval sought for debt restructuring plan
In response to the cyberattack, WazirX plans to file an application with the High Court of Singapore for a "Scheme of Arrangement."
This legal mechanism aims at restructuring of its debts and ensuring fair recovery for creditors.
The company hopes that this scheme could deliver better outcomes for creditors in comparison to liquidation, subject to creditor approval and court sanction.
User focus
WazirX emphasizes user-approved distribution of cryptocurrency assets
WazirX has emphasized its commitment to an equitable as well as user-approved distribution of cryptocurrency assets through the proposed Scheme of Arrangement.
The company asserts that this scheme is a required step to ensure fair treatment for users and legally binding on all relevant parties.
The exchange also stated that the Scheme of Arrangement will "ensure that the platform has the time and breathing space it needs to pursue a restructuring."