WazirX issues RT tokens as part of cyberattack recovery
WazirX issues Recovery Tokens for hacked users
The Indian cryptocurrency exchange WazirX will issue Recovery Tokens (RT) to compensate users affected by a major cyberattack in 2024.
This move follows the company’s completion of its Net Liquid Platform Assets (NLPA) rebalancing process, which aims to align the platform’s reserves with its liabilities, according to Cryptopolitan.
How WazirX recovery tokens work
The newly issued RT tokens will be distributed among affected users, providing them with market exposure and potential liquidity. WazirX founder Nischal Shetty hinted that if demand is strong enough, these tokens may soon become tradable on the exchange.
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The recovery strategy includes three key initiatives:
- Profit distribution to replenish lost funds.
- Asset recovery through legal and technical means.
- The launch of a decentralized exchange (DEX) to enhance transparency and security.
Court-approved token distribution
On January 23, WazirX’s parent company, Zettai Pte Ltd, received approval from the Singapore High Court to hold a creditors' meeting. Creditors will vote on the proposed Scheme of Arrangement, which includes immediate asset distribution.
If approved, users will receive tokens instead of fiat compensation, potentially benefiting from future price appreciation.
Users can check their allocations on the First Distribution page, which displays:
- The calculated share value in the rebalanced NLPA in USD.
- Effective USD recovery (in %).
- Unique identifier.
- Current value of the calculated share in the rebalanced NLPA.
- Breakdown of tokens in the calculated share of the rebalanced NLPA.
- Crypto deposits.
Concerns about price volatility
Some users have raised concerns about fluctuating token values. One investor asked why the displayed NLPA value differed from its current USD value. Shetty clarified: "From now on, you hold any market upside or downside."
According to WazirX, the tokens will be distributed within 10 business days of the scheme’s approval. However, low-liquidity assets such as ANT, LOVELY, PUSH, GFT, OOKI, MDX, BOB, and WRX will be partially distributed in their original denominations. Any remaining balance will be settled in USDT or another stablecoin.
For example, if a creditor is entitled to 800 PUSH from the rebalanced NLPA, they may receive 500 PUSH, with the remaining 300 PUSH converted into USDT.
What happens if the scheme is rejected?
WazirX warned that if creditors vote against the plan, compensation will be delayed until ownership disputes over the platform are resolved.
The exchange reassured users that token prices are based on live CoinMarketCap data, but minor discrepancies of up to 0.5% may occur due to market volatility and the high volume of transactions processed during rebalancing.
Background: The $230 million hack
The recovery effort follows a massive security breach in July 2024, in which hackers stole over $230 million in user funds. The attack affected 15 million investors, raising concerns about WazirX’s security infrastructure and its ability to mitigate such risks in the future.
