As a seasoned researcher with years of experience in the digital asset industry, I find myself perplexed by the recent announcement made by WazirX regarding their Committee of Creditors (COC). With over 4.4 million users and a staggering Rs 2000 crore hack, one would expect a more transparent and inclusive process for such an important decision-making body.
As a crypto investor, I recently learned that WazirX has formed a 10-member committee, known as the ‘Committee of Creditors’ (COC), selected randomly from their user base of over 4.4 million individuals. This committee will serve in a vital advisory capacity during the restructuring phase of the exchange following the hack that resulted in a loss of approximately Rs 2000 crore. I find this move to be both inclusive and proactive, ensuring the voice of every user is heard during these challenging times for the crypto exchange.
WazirX leadership has disclosed that the initial gathering of their anonymous Committee of Control (COC) will occur on October 15th, but virtually. All participants will receive details about the meeting through email. However, some users are uncertain due to the secretive nature of the exchange, as the management explains they’re keeping the identities of the COC members confidential for “security reasons.
WazirX management announced that the inaugural meeting of our Committee of Creditors (COC) is scheduled for October 15 using Zoom. Minutes from all COC meetings will be compiled thoroughly and distributed to every company creditor, while maintaining privacy and confidentiality by making any necessary redactions.
As a researcher examining the situation, I find myself at a loss to validate the authenticity of the COC (Cryptocurrency Oversight Committee) for WazirX, leaving its 4.4 million users in the dark about the restructuring process and whether their concerns will be adequately addressed by the committee members. The enigmatic nature of these operations raises questions about the transparency and fairness of the process.
The recent development follows WazirX hosting a live townhall meeting on October 4 to clarify the process of creating a Code of Conduct (COC). However, after asserting that they would distribute 100% cryptocurrency earnings among users, they subsequently made the video unavailable for viewing on YouTube.
Understand WazirX Committee of Creditors Here:
On July 18th, WazirX suffered a significant cyber attack, leading to the theft of approximately 20 billion rupees worth of cryptocurrencies, which were user funds. The attack caused a loss of about 45% of the total user funds, prompting the exchange management to temporarily halt all withdrawals of the remaining 55%. They proposed that all users would need to accept a collective reduction, or haircut, of between 43-45% on their individual portfolios.
Through its parent company Zettai Pte Ltd, the WazirX exchange petitioned the Singapore High Court for a four-month moratorium to prevent legal action from users and allow them time to develop a plan for distributing the remaining 55% of their funds to users. The court granted this request under the condition that WazirX maintains transparency and fairness towards all its users, and conducts an unbiased third-party survey to determine if the users approve of this restructuring plan.
The formation of the COC occurs following a user selection procedure that began on October 3, 2024. In this process, an initial pool of 43,000 users was created, from which 10 were randomly chosen without disclosing their identities. As stated by WazirX, the role of the COC will be advisory in the restructuring phase, and it will serve as a representative for the exchange’s 4.4 million users.
The Committee of Creditors (COC) will be constructed in a fair manner, ensuring that it truly represents the interests of all creditors during the restructuring phase.
— WazirX: India Ka Bitcoin Exchange (@WazirXIndia) October 8, 2024
As a crypto investor, I’ve noticed a rising unease among users and creditors regarding the formation of this committee. They believe that a more democratic and inclusive process should have been employed to ensure fair representation for all parties involved, rather than just a select few.
Conclusion
According to the exchange management, while the COC (Code of Conduct) may provide suggestions for restructuring, these recommendations will mainly serve as feedback and aren’t guaranteed to be adopted as official changes.
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2024-10-09 15:48