In July 2024, WazirX, India’s largest cryptocurrency exchange, was hit by a catastrophic cyberattack, losing over $230 million in digital assets to North Korea’s Lazarus Group. The breach, one of the largest in crypto history, obliterated nearly 45% of user funds, plunging the platform into crisis and eroding user trust. As WazirX pursues a Singapore High Court-supervised restructuring, skepticism abounds regarding its ability to recover.
On July 18, 2024, hackers exploited a multisig wallet vulnerability, stealing $230 million in crypto assets. Trading and withdrawals were halted, leaving users like a 24-year-old from Andhra Pradesh, who lost Rs 30 lakh, in financial ruin. “We were planning to buy a house… now I don’t have enough money to buy groceries,” he told Moneycontrol.
The hack’s fallout fueled outrage, amplified by WazirX’s initial “socialized loss strategy” to spread the $230 million loss across all users. Deepak Shenoy, CEO of Capital Mind, slammed the approach on X: “This should be the end of WazirX. The idea is that the company saw a theft for which they will charge all their users.”
“The freeze on 50% of WazirX’s assets is a pretty serious situation,” crypto influencer Aditya Singh posted on X, highlighting the Lazarus Group’s history of non-cooperation.
Read More: Detailed real-time updated coverage of the WazirX Court Hearing
WazirX scrapped its widely criticized 55/45 plan (allowing access to 55% of funds while locking 45% in USDT-equivalent tokens) and proposed a Scheme of Arrangement under Singapore’s High Court. The plan promises 85% fund recovery by April 2025, pending creditor approval, but its feasibility is dubious:
The plan’s complexity and reliance on unproven ventures have drawn sharp criticism. X posts suggest users may recover only 50-60% of funds, with RTs potentially worthless if revenue falters. “WazirX’s recovery token sounds like a desperate punt,” one user posted, reflecting widespread distrust.
“We are working towards launching a Recovery Token… proportionate to their balances,” WazirX posted on X, but the promise rings hollow amid user skepticism.
ALSO READ: What is the WazirX Restructuring Scheme? A Simple Explainer
Experts and social media users alike express deep reservations about WazirX’s recovery. Deepak Shenoy, a vocal critic, argued on X that full recovery is “very slim,” insisting WazirX should absorb losses before burdening users. Sumit Gupta, CoinDCX co-founder, called the exchange’s approach “not community first,” accusing it of mishandling user funds.
The ongoing Binance ownership dispute—stemming from an uncompleted 2019 acquisition—further undermines confidence, as WazirX’s parent, Zettai Pte Ltd, lacks direct revenue access.
On X, sentiment is overwhelmingly negative. Users like @CryptoSkepticIN posted, “WazirX’s ‘recovery plan’ is a fancy way of saying ‘you’re not getting your money back.’” Another, @TraderVik, warned, “RTs are a gamble. No profits, no buybacks, no recovery.”
Hashtags like #WazirXScam trend sporadically, with users sharing stories of locked funds and restricted token sales. Even optimistic voices, like Sunil Kavuri, who compared WazirX’s plan to FTX’s, face pushback online, with replies like, “FTX creditors waited years. WazirX users can’t afford that.”
“The first contribution to losses should ALWAYS come from the Company,” Gupta posted on X, echoing a common sentiment that WazirX is dodging accountability.
If creditors approve the Scheme (voted March 19-28, 2025, awaiting court sanction), WazirX might distribute 50-60% of funds by mid-2025. However, the DEX and other initiatives may underperform, leaving RTs illiquid and buybacks stalled. The Binance dispute could hinder fundraising, prolonging user losses. This scenario, the most likely, offers partial relief but no full recovery.
If the restructuring plan is rejected or the court denies sanction, liquidation looms. Users could face delays until 2030, with payouts likely in fiat, missing crypto market gains. Legal and liquidation costs may reduce recoveries to a fraction of original holdings, devastating users.
A successful DEX, robust profits, and a “white knight” investor could enable 85% recovery by April 2025 and RT buybacks within 36 months. This scenario requires flawless execution, restored trust, and a favorable market—highly improbable given current challenges.
The hack’s impact is deeply personal. Mumbai developer Anuj Sharma, who lost Rs 35 lakh, faces financial strain and restricted token sales due to WazirX’s rapid listing push. Legal battles are escalating, with 30 victims planning a class-action lawsuit and cases filed with India’s National Company Law Tribunal and Delhi High Court. Regulatory scrutiny is intensifying, with investigations by India’s Financial Intelligence Unit, Intelligence Bureau, and CERT-In, compounded by the Enforcement Directorate’s $1.1 million deposit in WazirX wallets.
“Centralised exchanges are literally the opposite of decentralised finance… politicians will use this hack to throw dirt at crypto,” blockchain researcher Mudit Gupta posted on X.
WazirX’s recovery plan is a long shot, riddled with unrealistic assumptions and operational risks. Social media reflects a community disillusioned by vague promises and token-based recovery schemes. Experts like Shenoy and Gupta underscore WazirX’s accountability failures, while the Binance dispute and regulatory pressure darken the horizon.
Users face a grim choice: back a flawed restructuring or endure years of liquidation delays. As X user @CryptoRealist put it, “WazirX’s recovery is a pipe dream. Trust is gone, and so is our money.” The road ahead looks arduous, with full recovery a distant, if not unattainable, goal.
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1. What happened to WazirX in July 2024?
WazirX was hacked by North Korea’s Lazarus Group, resulting in a $230 million loss—one of the largest in crypto history. This triggered a major trust crisis and halted user withdrawals.
2. What is WazirX’s current recovery plan?
WazirX has proposed a Singapore court-supervised Scheme of Arrangement, aiming to return 85% of user funds through a mix of liquid distributions and Recovery Tokens.
3. Are users likely to recover their full funds?
Most experts believe full recovery is unlikely. Estimates suggest users may get back only 50–60%, depending on the success of WazirX’s future ventures and Recovery Token buybacks.
4. What are Recovery Tokens (RTs)?
RTs are tokens issued to users in place of unrecovered funds, with a promise of buybacks over 36 months. However, concerns remain about their liquidity and actual value.
5. What happens if the court rejects WazirX’s plan?
If the recovery plan fails, WazirX may enter liquidation, delaying any compensation for years and significantly reducing the value of user recoveries.
Krishnan is a Bangalore-based crypto writer dedicated to simplifying complex crypto concepts. He covers blockchain, DeFi, and NFTs, with a focus on real-world asset tokenization and digital trust. Previously he has written on Real Estate related assets for NoBroker. Krishnan holds a B.Tech degree from the College of Engineering Trivandrum.
