The Delhi High Court has sought a fresh probe into WazirX’s second-quarter $235 million hack. This order follows police failure to provide proof of criminal misconduct in their original investigation. There were still major unanswered questions about the July 2024 breach, with large amounts of funds unaccounted for.
WazirX’s running troubles grew further when Binance announced its intention to delist the WRX token, causing more trouble for the platform market phase. The announcement has plunged the token’s value and poured cold water on the future of the exchange.
Andréi Lugovoi is a member of the Russian Parliament; he has previously denied any involvement in Lugovoi’s murder. The court’s order is directed at revealing the activity of a hacking group that has been tied to North Korea. The assailants were able to make off with funds not because they had breached WazirX but instead because they had exploited shortcomings in WazirX’s systems.
While 57% of the stolen funds have been recovered, the roughly $100 million that remains unrecoverable reflects the enormity of the breach. Investigators are also examining the role of a man from West Bengal, Masud Alam, who was detained in November. Alam is accused of setting up fake accounts that were subsequently on-sold to hackers on Telegram, purportedly facilitating the breach.
But the culprit who planned the assault is still unknown, adding to the mounting pressure on law enforcement for tangible results.
Binance Delists WRX Token, Sending Ripples in Market
In another blow, Binance plans to delist the WRX token due to “operational shortcomings,” WazirX said. Binance, which has consistently denied it owns WazirX, said the platform operates under Indian regulations via Zanmai Labs. It is due to be delisted on December 25.
This announcement has sent the market into a panic, with WRX losing over 51% of its value in the ensuing fallout. Investors are worried about the platform’s operational stability and the implications of Binance’s decision. Delisting limits the token’s liquidity and also indicates a loss of trust in WazirX’s ability to recover from recent troubles.
WazirX Aims Comeback As Struggles Mount
Despite these hurdles, WazirX is charting a path for a revival. Today, the exchange announced its fifth town hall meeting to promote transparency and restore trust. One of the main strategies is to launch DEX and upgrade user services.
In its statement, WazirX stressed the importance of “rebuilding with integrity,” pledging improvements to user security and operational transparency. Yet the road ahead is a tumultuous one, with the platform facing scrutiny from investigations, market scepticism, and the consequences of the delisting that Binance’s decision will eventually bring.
WazirX Finds Itself in a Very Difficult Situation
The renewed investigation and market turmoil have put WazirX in a vulnerable space. The Delhi High Court’s demand for deeper investigation speaks to the seriousness of the allegations, while Binance’s revocation of support for WRX adds an extra degree of difficulty in recovery efforts.
With much of the stolen funds yet to be accounted for and the brains behind the hack still on the loose, the trouble isn’t over for WazirX.
Time will tell if WazirX can successfully distance itself from this controversy and, in the wake of significant scrutiny, restore the faith of investors as it embarks on a journey of redemption and rebuilding.
The next few months will be critical in deciding whether the exchange can weather these storms or be overwhelmed by the rising stresses.
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FAQs
What investigation is the Delhi High Court conducting into WazirX?
In a significant development, the Delhi High Court has directed a fresh investigation into the $235 million hack of WazirX, demanding answers to key questions and the identification of the main hacker behind the cyberattack.
Why does Binance have to delist the WRX token?
The token was removed by Binance due to WazirX’s non-compliance with operational standards. As a result, WRX’s value fell by more than 51%, negatively affecting investor confidence.
Then what role did Masud Alam play in the WazirX hack?
The creation of a bogus account that was sold to a hacker on Telegram may have facilitated the $235 million hack. He has been arrested for his alleged role.
What are WazirX’s strategies for continuing after these issues?
WazirX will be reinventing its platform in a new avatar of more transparency and services. The platform is focused on building a user-centric decentralized exchange (DEX) to restore trust.
