Petition Filed In NCLT For Investigation Into $230 Mn Crypto Heist At WazirX

SUMMARY

The petition, filed by a legal trainee, has listed WazirX's parent Zanmai Labs, its infrastructure partner Liminal, the exchange’s founders Sameer Mhatre and Nischal Shetty among respondents

The Ministry of Home Affairs, the Ministry of Finance, and the Ministry of Corporate Affairs have also been named as respondents

At the heart of the matter is WazirX’s crypto debacle when a security breach impacted one of its wallets Safe Multisig on the Ethereum network, leading to users losing funds to the tune of $230 Mn

A petition has been filed in the National Company Law Tribunal (NCLT) against WazirX and others for an investigation into the $230 Mn crypto heist at the crypto exchange.

The petition, filed by a legal trainee Gauransh Vyas, has listed WazirX’s parent Zanmai Labs, its infrastructure partner Liminal, the crypto exchange’s founders Sameer Mhatre and Nischal Shetty, Liminal’s India entity First Answer India Technologies, Mhatre and Shetty’s Codigami Technologies and Crowdfire India as the respondents.

Besides, the Ministry of Home Affairs, the Ministry of Finance, and the Ministry of Corporate Affairs have also been named as respondents.

The petition has been filed under Section 213(b) and Section 221 of the Companies Act, 2013. It was filed before the Indore bench of the NCLT on August 3 and was admitted on August 5. The matter is due for a hearing on September 3, as per Rawal.

Vyas’ advocate Varun Rawal told Inc42 that the petition has been filed as a public interest litigation (PIL) of sorts and stems from his client’s intent to get to the bottom of the crypto heist at WazirX. “With the petition, we are seeking an investigation into the affairs of the company to understand what really happened and who was behind the mishap,” he told Inc42.

Responding to Inc42’s queries on the matter, a WazirX spokesperson said that the startup will respond to the petition.

“We are aware of the petition filed against us before the NCLT, Indore and we are taking necessary legal action. Since it is an ongoing legal proceeding, we cannot discuss the details of the petition,” the spokesperson said.

At the heart of the matter is WazirX’s crypto debacle, which happened on July 18, when a security breach impacted one of its wallets Safe Multisig on the Ethereum network, leading to users losing funds to the tune of $230 Mn. It has been speculated that North Korean entity Lazarus Group was likely behind the heist.

Following this, WazirX filed a police complaint on the issue. On Tuesday, cofounder Shetty said that a first information report (FIR) was filed in connection with the $230 Mn cyberattack with the special cell of New Delhi’s Lodhi Colony police station.

While the company is exploring ways for a bail out in relation to the whole debacle, it had plans to make customers absorb 45% of the losses. After a public outlash, the crypto exchange has now “decided to go slow” on its 55-45 approach.