WazirX hack: Crypto exchange drops plan to socialise losses after backlash

Hacked crypto exchange WazirX is back to ground zero after plans to socialise its losses faced massive pushback from customers during its week-long poll that concluded on August 3rd, sources told Moneycontrol.

The poll was set up on July 27 to decide on a way forward to restart operations, as the exchange paused had withdrawals and trading following a $230-million security breach in one of its multisig wallets. The exchange lost 45 percent of its crypto assets in the theft.

The plan to socialise losses, or the 55/45 approach, allows customers to access and trade only 55 percent of their assets on the exchange, while the remaining 45 percent will be converted to stablecoins (USDT) and locked by the exchange, irrespective of whether the customer’s assets have been stolen.

“The plan wasn’t final. So, to restart operations, the exchange had to chart a forward path and reached out for the community’s feedback. After the blowback, WazirX decided to go slow on it,” the source told Moneycontrol.