WazirX to Disclose 240,000 Wallets Amid Restructuring

In a significant move toward transparency, WazirX, one of India’s largest cryptocurrency exchanges, is set to disclose details of 240,000 wallet addresses and their respective balances in an affidavit filed with the High Court of Singapore. This disclosure is part of the exchange’s ongoing efforts to restructure its operations and repay users following a crippling $230 million cyberattack in July.

The exchange, which is currently being overseen by its holding company Zettai Pte Ltd, has been working through a complex debt restructuring process to stabilize its operations and restore access to customer funds.

WazirX’s Commitment to Transparency

WazirX has emphasized its dedication to transparency as a way of rebuilding trust after the attack that left millions of users without access to their funds. In a recent statement on Twitter, the exchange stated, “At WazirX, we’ve always believed that transparency is key to building and maintaining trust with our users.” This public disclosure of wallet addresses and balances is a critical step in that direction.

Although disclosing such a large volume of wallets may seem overwhelming, WazirX explained in a blog post that managing a vast number of wallets is standard practice for an exchange serving 4.3 million users. The company confirmed that most wallet balances have already been consolidated into cold, warm, or hot wallets for operational purposes. The remaining balances are being carefully managed to minimize network fees during the consolidation process.

According to WazirX, this move will provide creditors and users with an unfiltered view of the exchange’s operations, helping to ensure that everyone remains informed as the company works toward stabilizing its platform.

The Cyberattack and Its Fallout

The July 2023 breach dealt a severe blow to WazirX’s operations, with the attackers targeting several major cryptocurrencies, including Pepe (PEPE), Gala Games (GALA), Tether (USDT), and Ethereum (ETH). The stolen assets were funneled through Tornado Cash, a controversial coin mixer designed to obscure the source of funds, making it difficult to track the stolen crypto.

In the immediate aftermath of the hack, WazirX suspended both crypto and Indian Rupee (INR) withdrawals, leaving its users in limbo. While partial INR withdrawals have since resumed, crypto withdrawals remain on hold as the exchange continues to consolidate its wallet balances and work through the process of repaying affected users.

Legal Complications and External Threats

The High Court of Singapore granted WazirX a four-month moratorium to restructure its liabilities, allowing the exchange some breathing room to recover from the attack. However, the process has been complicated by legal disputes with rival exchange CoinSwitch over $9.7 million in locked funds.

The July breach has also drawn the attention of authorities, who suspect that state-backed actors, potentially linked to the North Korean Lazarus Group, were involved. The Lazarus Group is infamous for executing large-scale cyberattacks and laundering stolen funds across multiple jurisdictions, often using decentralized coin mixers like Tornado Cash to cover their tracks.

The involvement of a sophisticated hacking group further complicates WazirX’s efforts to trace the stolen funds and restore user balances, adding another layer of difficulty to the already complex restructuring process.

Looking Ahead: Restoring Trust and Operations

WazirX’s decision to disclose its wallet addresses and balances comes as part of a broader effort to rebuild trust with its users and creditors. By providing a transparent view of its operations, the exchange aims to reassure its community that it is taking concrete steps toward resolving the situation.

The platform’s restructuring efforts, while challenging, mark a critical step in restoring user confidence and re-establishing its position in the competitive crypto exchange space. Although the full restoration of operations may take time, WazirX’s commitment to transparency could help stabilize the company and its relationships with users.

As WazirX navigates its debt restructuring and recovery efforts following the devastating cyberattack, the disclosure of 240,000 wallet addresses is a bold move toward transparency and accountability. While the exchange still faces significant hurdles, including legal disputes and the fallout from the cyber breach, its openness may be key to rebuilding trust with its users and ensuring a path forward. As the investigation into the hack continues and WazirX works to consolidate its operations, the exchange’s next steps will be closely watched by both users and regulators alike.