WazirX launches a “55⁄45 approach” post-cyber attack, securing 45% of funds as USDT-equivalent tokens and offering immediate access to 55% of assets for affected users.
Points
- WazirX launches the “55⁄45 approach” to address a $230 million cyber attack.
- Affected users can access 55% of their assets immediately, with the remaining 45% managed through tailored recovery options.
- The exchange commits to fair and transparent handling of the situation.
WazirX has introduced the “55⁄45 approach” to offer a faster and more flexible solution for its affected users following a cyber attack that resulted in the theft of $230 million, equivalent to 45% of user funds. The exchange’s new strategy allows users to access a significant portion of their assets immediately while the remaining portion is managed through tailored recovery options.
Details of the 55⁄45 Approach
In response to the recent cyber attack, WazirX has committed to handling the situation fairly and transparently by implementing a socialized loss strategy to distribute the impact equitably among all users. A balanced portfolio of unlocked portions （55%） will be created using a section of crypto assets. If 55% of the unlocked portfolio holds affected tokens, it will be balanced by replacing the impacted portion with a basket of available unaffected tokens.
The exchange will calculate the value of the unlocked portfolio （55%） based on average prices as of July 21, 2024, 8:30 PM IST, using data from CoinMarketCap and select global exchanges.
Focus on Fair and Transparent Recovery
Nischal Shetty, founder of W
azirX, emphasized in a post on X that the fastest way to reopen the hacked exchange operations is to socialize the loss across crypto portfolios. He suggested that this process would not impact the INR wallet balance, as the partial lock is for the crypto portfolio balance only. This would mark the end of phase 1 and the beginning of phase 2, which would focus on the recovery of the stolen assets.
Shetty highlighted that WazirX’s recovery effort will involve working on the recovery of stolen assets while seeking partnerships and external assistance. However, he acknowledged that the recovery of such a significant amount takes time. The platform will be in a better position to open sooner if they socialize the losses, similar to how other impacted exchanges have managed recovery in the past.
Market Reactions
The global crypto market has seen fluctuations over the last week. Bitcoin （BTC） traded around the $66K-$67K range on July 21 and then dipped to the $63K level. BTC has managed to recover and is up by over 2% in the last seven days. At press time, Bitcoin is trading at an average price of $68,201.
Ether （ETH） hovered around the $3,500 price level on July 21. It dipped to the $3,100 zone in the past few days. ETH price is down by 6% in the last seven days, with the second-largest crypto trading at an average price of $3,278 at the press time.
Conclusion
WazirX’s introduction of the 55⁄45 recovery plan reflects its commitment to fair and transparent handling of the recent cyber attack. By offering immediate access to a portion of assets and focusing on full recovery, WazirX aims to restore confidence among its users and reopen the exchange as soon as possible.