WazirX Parent Calls for ‘White Knights’ to Assist in Exchange Rescue

cryptonews.com:

Shalini is a crypto reporter who provides in-depth reports on daily developments and regulatory shifts in the cryptocurrency sector.

WazirX parent firm Zettai is engaging with 11 crypto exchanges and trading firms to secure emergency funding or establish partnerships aimed at recovering the $235m lost in a July hack, the Economic Times reported Tuesday.

“We’re working to try to get potential investors, white knights, to contribute funding. Those discussions are ongoing,” WazirX co-founder Nischal Shetty said during a townhall on Monday.

Shetty and the company’s legal advisers reportedly stated that even with potential support from white knights, WazirX investors might not receive full compensation for the losses incurred due to the cyberattack.

“In crypto terms, it’s extremely unlikely that we can make people whole,” said Jason Kardachi, managing director at Zettai’s advisory firm Kroll. He added that at best, they could return between 55% and 57% of the funds.

The 11 companies reportedly each handle 5.5m to 100m users and process daily transactions from $5m to $4b.

These discussions began after Zettai applied to the Singapore High Court last week for a moratorium. A major cyber attack on WazirX on July 18, which led to the theft of over $230m (₹2000 crore) in crypto assets, prompted this application.

Shetty further added that the restructuring process is anticipated to take a minimum of six months. This is because, he noted, there is a considerable amount of work involved in crafting the plan. It’s also necessary to take into account feedback from WazirX’s 4.3 million creditors, he said.

During Monday’s Townhall, Shetty presented a slide that highlighted the ongoing dispute between Zettai and Binance over platform ownership.