WazirX Faces Crypto Withdrawal Freeze Amid Legal Probe, Users to Receive Only 66% INR

• WazirX halts 34% of INR withdrawals due to ongoing legal probes post-hacking incident.  
• Exchange lacks crypto assets to fulfill user obligations after losing Rs 2,000 crores in hack.
• WazirX to pursue Singapore Scheme of Arrangement amidst user concerns and legal complexities.

WazirX, one of India’s prominent cryptocurrency exchanges, has announced that it cannot process crypto withdrawals, citing legal investigations following a major hacking incident. In a statement released on Friday, the exchange disclosed that users can only withdraw 66% of their Indian Rupee (INR) balance, with the remaining 34% frozen until further notice. 

This decision comes as a significant blow to users, who have been protesting the suspension of their funds since the cyberattack on July 18.

WazirX’s announcement marks a critical development for its user base, which has been anxiously awaiting the resumption of full withdrawals. Due to ongoing legal investigations, the exchange stated that 34% of the INR balance would remain inaccessible. 

The company emphasized that it currently lacks the crypto assets required to meet its obligations to users following the loss of 45% of investor funds, amounting to approximately Rs 2,000 crores, during the hack.

In an official statement, WazirX explained, “Due to the cyberattack and loss of a significant balance of ERC-20 tokens as a result of the theft, there are insufficient token assets available to meet the liabilities arising from the token balances owing to platform users.”

According to WazirX, the company plans to pursue a “Singapore Scheme of Arrangement,” which is a procedure subject to the Singapore Insolvency, Restructuring, and Dissolution Act (2018). According to the exchange’s user agreement policy, the Singapore International Arbitration Centre (SIAC) will mediate any legal disputes between users and Zanmai, WazirX’s parent company.

Despite the challenges, WazirX assured users that it has sufficient funds to facilitate 100% INR withdrawals through Zanmai Private Limited. However, the exchange reiterated that the 34% INR funds will remain frozen until the completion of the ongoing investigations.