USDCoinSwitch Announces $70 Million Recovery Fund for WazirX Hack Victims
Indian Crypto Giant Steps in to Aid WazirX Users
CoinSwitch, one of India’s leading cryptocurrency exchanges, has unveiled a $70 million recovery fund aimed at supporting users affected by the 2024 WazirX hack. The initiative, branded as “CoinSwitch Cares,” represents a significant effort to address the aftermath of an alleged cyberattack that resulted in the loss of $235 million from WazirX accounts. The recovery fund, valued at 600 crore Indian rupees, will be distributed over the next two years, with CoinSwitch positioning itself as a lifeline for impacted users while simultaneously expanding its customer base.
The recovery program, announced on January 7 via X (formerly Twitter), is open to WazirX users who can provide proof of their losses. Affected individuals must submit loss statements and any additional evidence requested by CoinSwitch to qualify for compensation. The exchange plans to distribute the funds through a combination of sign-up bonuses, revenue sharing, and referral incentives. However, while users can sell cryptocurrency and withdraw funds in rupees, direct crypto withdrawals are currently unavailable on the platform.
CoinSwitch co-founder Ashish Singhal highlighted the company’s commitment to funding the program entirely from its own cash reserves, showcasing the exchange’s financial stability. “We have about five years of runway from where we sit. The current bull run has only strengthened our position,” Singhal stated, emphasizing the company’s readiness to invest in bolstering India’s crypto ecosystem. CoinSwitch’s cash reserves will sustain the two-year recovery initiative, ensuring adequate resources to assist approximately four million WazirX users.
The plan also incorporates a meticulous process for verifying and calculating user claims. Once WazirX resumes crypto withdrawals, CoinSwitch intends to validate user losses by analyzing balance statements and other relevant data. This approach aims to provide clarity and fairness in compensating affected individuals. Singhal noted that having access to precise records of assets under management will simplify the calculation of rewards and distribution of funds.
The timing of the announcement aligns with ongoing controversies surrounding WazirX’s alleged negligence leading up to the hack. The breach, which occurred in July 2024, has been marred by disputes between WazirX and its custody provider, Liminal. Liminal has accused WazirX of relying on compromised devices, further intensifying scrutiny over the platform’s security practices. The fallout has left millions of users stranded, prompting CoinSwitch to step in as a stabilizing force within the Indian crypto landscape.
CoinSwitch, founded in 2017, has grown into a prominent player in the global crypto industry, boasting 20 million registered users. Backed by influential investors such as Andreessen Horowitz, Tiger Global, Coinbase Ventures, and Peak XV Partners, the exchange has consistently demonstrated its ability to navigate volatile market conditions. By addressing the needs of WazirX users, CoinSwitch aims to fortify its reputation as a reliable and customer-centric platform, reinforcing trust within the broader crypto community.
This article has been refined and enhanced by ChatGPT.
