- WazirX has announced a controversial “socialized loss” strategy.
- The exchange said users should equally share the impact of the recent hack on its platform.
- WazirX lost $234 million, or 45% of user funds to the hack.
India’s largest crypto exchange WazirX announced today plans to resume operations after a “poll” that would allow users to trade or withdraw part of their funds available on the platform.
WazirX paused withdrawals after its Safe Multisig wallet on the Ethereum Network was attacked recently in one of the biggest crypto hacks of the year, leading to the theft of about $234 million in assorted cryptos. The exchange said this amount represented 45% of user funds.
Resumption After “Socialized Loss” Strategy
In the statement , WazirX said it would employ a transparent “socialized loss” strategy to distribute the hack’s impact equitably across all users. Part of this approach includes giving users access to 55% of the total value of their crypto assets and locking the remaining 45% in USDT-equivalent tokens.
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The value of the unlocked portfolio (55%) will be calculated based on average prices from CoinMarketCap and select exchanges as of July 21, 8:30 PM IST. Conditions for unlocking the remaining 45% are subject to ongoing recovery efforts and exploration of other compensation methods, including potential airdrops.
Terming it “fair,” the exchange defended the approach, claiming that it would save users from years of uncertainty and limited access to funds.
“Our 55/45 approach offers a faster, more flexible solution. This strategy allows immediate access to a significant portion of your assets while maintaining the possibility of further recovery for those who choose to wait.” The exchange said.Per the statement, WazirX users have up to August 3rd to submit a poll on how they want to manage their assets. The exchange said it would resume operations “shortly after the poll.”
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Stay updated on WazirX’s asset recovery efforts:
WazirX Bolsters Asset Recovery Efforts with Two Sets of Bounties
Read how LI.FI was recently hacked for $10 million:
LI.FI Hack Steals $10M from Users: How to Protect Your Funds
