2024

Abyss

Bitcoin

WazirX

The WazirX exchange announced setting up of their 10 member anonymous ‘Committee of Creditors’, (COC) chosen randomly from its 4.4 million users as per the management, who will play a “crucial consultative” role in the restructuring process of the crypto exchange, post the Rs 2000 crore hack. 
WazirX management has announced that the first meeting of this anonymous COC will be held on October 15 virtually, and the details of the meeting will be shared with all users via mail. However, it is the hazy workings of the exchange, that has left many users in doubt, as the management has cited “security reasons” behind not revealing the identity of the COC members. 
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 “The first COC meeting will be held on October 15 via Zoom. All COC meetings will be minuted in detail and said minutes will be provided to all creditors of the company, with any necessary redactions for confidentiality and data privacy reasons,” read a mail from WazirX management on Wednesday. 
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With practically no means to confirm the veracity of this COC, the 4.4 million users of WazirX are left in the dark regarding the restructuring process and whether their grievances will be properly represented by the committee members. 
The fresh announcement comes after WazirX organized a live townhall discussion on October 4 to discuss the COC formation procedure, however, they made the video<a href="https://www.cryptotimes.io/2024/10/04/wazirx-removes-video-after-claiming-to-give-100-crypto-profits-to-users/" target="_blank" rel="noreferrer noopener"> private</a> on <a href="https://www.youtube.com/watch?v=CzOm_nM3UeY" target="_blank" rel="noreferrer noopener nofollow">YouTube</a> after making claims that they will share 100% crypto profits with users. 
Understand WazirX Committee of Creditors Here: 
WazirX was hit by a massive cyber hack on July 18 which resulted in loss of Rs 2000 crore in the form of cryptocurrencies that were user funds. The cyber hack resulted in loss of 45% user funds after which the exchange management halted all withdrawals of remaining 55% user funds, and <a href="https://www.cryptotimes.io/2024/09/11/nischals-proposal-to-wazirx-users-its-my-way-or-highway/" target="_blank" rel="noreferrer noopener">proposed</a> to all users that they will have to take a socialistic haircut of 43-45% on their individual portfolios. 
The WazirX exchange, then through its parent entity Zettai Pte Ltd, approached Singapore High Court, requesting for a moratorium to avoid any legal action by users and seek time to layout their restructuring scheme of remaining 55% funds withdrawal to users . The four months moratorium was granted by the court on conditions that WazirX will ensure transparency and fairness to all its users and conduct an independent, third party polling on whether users approve of the restructuring scheme. 
The COC formation comes after a <a href="https://www.cryptotimes.io/2024/10/04/wazirxs-latest-marvel-non-transparent-10-member-committee-for-4-4m-users/" target="_blank" rel="noreferrer noopener">selection process</a> initiated on October 3, 2024, where initially 43,000 users were selected for the pool from which 10 users were anonymously picked. According to WazirX, the COC will play a consultative role in the restructuring process and will represent the 4.4 million users of the exchange. 
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 Here's how the Committee of Creditors (COC) will be fairly formed to represent creditors' interests in the restructuring process 👇 <a href="https://t.co/A3syJasD8s" target="_blank">pic.twitter.com/A3syJasD8s</a>— WazirX: India Ka Bitcoin Exchange (@WazirXIndia) <a href="https://twitter.com/WazirXIndia/status/1843553614364848456?ref_src=twsrc%5Etfw" target="_blank" rel="noopener">October 8, 2024</a>
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However, this development has been met with <a href="https://www.cryptotimes.io/2024/10/04/nischal-says-wazirx-users-cant-nominate-committee-members/" target="_blank" data-type="link" data-id="https://www.cryptotimes.io/2024/10/04/nischal-says-wazirx-users-cant-nominate-committee-members/" rel="noreferrer noopener">growing concerns</a> from users and creditors alike who argue that such an important committee should have been formed through a more democratic and inclusive method, ensuring adequate representation for all stakeholders, and not just a few. 
Conclusion 
While the COC is expected to consult on restructuring terms, those are only going to be feedback and not necessarily implemented, as explained by the exchange management. 
Many users fear that the process may drag on without delivering meaningful results. They feel that this could be a stalling tactic to buy more time, without providing any real clarity or solutions for those who have been waiting months to access their funds. 
<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow"> 
 Also Read:<a href="https://www.cryptotimes.io/2024/10/02/what-now-for-wazirx-users-a-long-wait-into-the-abyss/" target="_blank" rel="noreferrer noopener"> What Now for WazirX Users? A long wait into the Abyss</a> 
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Committee of Creditors: The “Trust Me Bro” Transparency Model of WazirX

The Crypto Times

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