WazirX CEO Reveals Reason For the Controversial $75M Crypto Transfer to Exchanges

WazirX founder Nischal Shetty has addressed the controversy surrounding the transfer of $75 million in crypto assets to two major exchanges. This follows accusations that the Indian crypto platform conducted the transactions secretly without notifying its users.

The issue came to light a week after WazirX disclosed more than 240,000 wallet addresses in an affidavit filed with a Singapore court. According to the platform, the disclosure was part of the conditions set by the court, which had granted the company a four-month moratorium in response to a $235 million hack in July.

CoinSwitch’s Accusation

Ashish Singhal, CEO of CoinSwitch, recently stated that his team had developed a system to help WazirX users navigate the extensive information released. Singhal explained that his company’s interest stems from holding the Indian rupee and virtual digital assets (VDA) with WazirX.

Making sense of WazirX’s wallet disclosure for users

Crypto exchange WazirX — which allegedly faced a cyberattack in July 2024 — has released over 240,000 wallet addresses as part of an affidavit they filed in the High Court of Singapore.

These many wallet addresses can be… pic.twitter.com/QfaEmuQXUZ

— Ashish Singhal (@ashish343) October 21, 2024

After the alleged hack halted transactions, CoinSwitch reportedly used its funds to compensate affected customers. The company is now pursuing legal action to recover the amount used for these compensations.

Singhal also mentioned that while analyzing the disclosed data, his team found that WazirX had transferred significant crypto amounts to other major exchanges after the hack. Specifically, he claimed that $72.13 million was sent to Bybit, and an additional $1.5 million was moved to KuCoin.

WazirX’s Response

Nischal Shetty has responded to the controversy, clarifying that the transfers were a legitimate step in transitioning to a new custodian after WazirX terminated its partnership with Liminal due to the July security breach.

False narrative, looks like coordinated campaign.

“secretly moved”? It was us who disclosed the addresses! We all know how blockchain works, everything is traceable. POR would anyways be revealing all this.

First Step: Share wallet addresses:[DONE]

Second step: Share POR… pic.twitter.com/n1oKYREsU0

— Nischal (Shardeum) 🔼 (@NischalShetty) October 22, 2024

He also noted that the complexities of custodianship mean that not all custody providers support every token. As a result, some crypto assets were temporarily moved to exchanges like Bybit and KuCoin, while WazirX sought more suitable custody solutions.

Shetty described the accusations as a “false narrative” and a “coordinated campaign,” denying any claims of undisclosed fund movements.

“We all know how blockchain works, everything is traceable. POR would anyways be revealing all this,” he said.

This commitment to transparency aligns with a recent report highlighting WazirX’s dedication to security and integrity.

In August, the exchange announced a scheduled eight-hour system outage to rectify account balances and reverse unauthorized transactions related to its security breach. According to a CoinTab report, this planned outage is part of WazirX’s broader strategy to recover from the July hack.