- CoinDCX CEO Sumit Gupta vehemently criticizes WazirX’s hack compensation plan for prioritizing business interests over its users.
- Backlash from the community highlights issues in the compensation options presented by WazirX, which reportedly cause significant user losses.
- Gupta calls for WazirX to bear the hack losses internally, deeming the current compensation strategy as grossly insufficient.
CoinDCX CEO slams WazirX’s hack compensation plan, calling it insufficient and more business-oriented than user-focused, urging for a more community-first approach.
Controversy Surrounding WazirX’s Hack Compensation Options
Following a major hack, WazirX, a prominent Indian cryptocurrency exchange, has been under fire for its proposed compensation plan. Sumit Gupta, CEO of CoinDCX, has publicly criticized WazirX’s response, labeling it as “utter nonsense” and not in the best interest of the affected users. According to WazirX’s compensation proposal, users have two choices to recover their lost assets:
Access 55% of Funds Without Withdrawals: Users can access 55% of their portfolios but cannot withdraw the amount immediately. The remaining 45% will be converted into Tether (USDT) or other available tokens, and these users will be given priority for any potential recovery proceeds.
Access 55% of Funds With Withdrawals: Users can withdraw 55% of their portfolios immediately, but the remaining funds will also be converted into USDT or other tokens. However, these users will have second priority for any potential recovery proceeds.
This compensation plan has been criticized for taking an unfair snapshot for valuing user portfolios on July 21, days after the hack when trading was still ongoing. This led to illicit trading activities and panic selling, exacerbating the losses users faced.
CEO Sumit Gupta’s Critique of WazirX’s Approach
Sumit Gupta has been vocal about his opposition to WazirX’s handling of the compensation. He pointed out that the company’s approach appears to focus more on protecting its business interests rather than shielding its users from the fallout of the hack. Gupta highlighted that WazirX should utilize its resources to absorb the hack’s losses fully. His critical assessment deemed the compensation plan inadequate, emphasizing the necessity for a community-first mindset in such critical times.
Gupta remains hopeful that WazirX would reconsider its strategy to better align with user interests. He pointed out unresolved issues, such as the crypto tax implications of forced token swaps, which pose additional concerns for users.
Conclusion
The fallout from the WazirX hack has drawn widespread criticism, particularly from high-profile figures like Sumit Gupta. The compensation plan, perceived as flawed and inequitable, underscores a broader issue within the cryptocurrency community about how exchanges handle crisis situations. As the community awaits further updates and the outcome of the user poll, there is mounting pressure on WazirX to adopt a more user-centric approach to rectifying the hack’s aftermath. This incident highlights the urgent need for transparent and user-focused crisis management strategies in the cryptocurrency industry.
