- CoinSwitch holds 1.51 times the user assets invested through its platform, ensuring all user funds are safe and secure.
- CoinSwitch is pursuing legal action against WazirX after a cyber attack led to the loss of $230 million (~Rs 2000 crore) on WazirX’s platform.
CoinSwitch, one of India's leading crypto platforms, has announced that it is pursuing legal action against WazirX after an alleged cyber attack resulted in the loss of $230 million (~Rs 2000 crore) in funds on WazirX's platform.
Despite multiple attempts to recover the funds, CoinSwitch has been unable to reach a resolution with WazirX, prompting this decisive step.
A note on CoinSwitch funds on WazirX - a thread🧵 pic.twitter.com/lnckwSnnPA
— CoinSwitch: India's Simplest Crypto App 🚀 (@CoinSwitch) August 28, 2024
Ashish Singhal, Co-founder and Group CEO of PeepalCo, reassured users that all funds on CoinSwitch are "safe and secure." CoinSwitch maintains a minimum 1:1 ratio of user funds at all times and, following the incident, utilized its own treasury to uphold this ratio.
Singhal emphasized, "Overall, we hold funds that are 1.51 times the user assets invested through CoinSwitch."
CoinSwitch disclosed that Rs 12.4 crore in INR, Rs 28.7 crore in ERC20 tokens, and Rs 39.9 crore in other tokens were held on WazirX, amounting to approximately 2% of CoinSwitch's total funds. Despite the breach, only the ERC20 tokens, which represent less than 1% of total CoinSwitch funds, were reportedly impacted.
The company clarified that it maintains a small amount of liquidity (~7%) on third-party exchanges to facilitate seamless trading for its users. CoinSwitch's robust financial position and governance practices have enabled it to absorb external shocks and ensure that user balances remain unaffected.
CoinSwitch will publish its proof of reserves for the second time this year to further bolster transparency and user trust.
Edited by Harshajit Sarmah
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Harshajit Sarmah
