Top crypto exchange in India, WazirX, has come up with a big come back strategy. After seven months from the biggest crypto hack attack in India, the crypto exchange has started futures trading as a way of restoring user activities, regaining market confidence and creating additional income streams.
This has followed the devastating hack attack on WazirX worth $230 million last year which had significantly impacted trading and withdrawal of funds in addition to damaging investor confidence. At the moment, WazirX believes that it can get back into the Indian crypto market by initiating the futures trading.
Introducing Futures Trading at WazirX
As reported, WazirX futures trading platform now offers futures trading services to investors in the crypto industry with 36 crypto tokens available for trading on the exchange. This includes leveraging starting at 10X and plans to increase in the future.
WazirX futures trading platform will offer one of the most affordable fee structure in the entire Indian crypto exchange industry. Maker fees are set at 0.02% and taker fees at 0.04% without having to meet any trade volume requirement for the first time on any global exchanges.
As per the remarks made by the founder, the goal is to democratize crypto futures trading in India by offering retail customers institutional-like fee schedules.
One interesting point to note is that unlike several global crypto derivatives platforms, WazirX is also providing the option to trade directly in Indian rupee rather than being compelled to convert funds to stablecoin like USDT.
A Dark Cloud Looming Over $230 Million Hack
In spite of the new service, there is no denying that the exchange also needs to work hard to rebuild trust among its customers after the huge cyber-attack that hit the Indian crypto space.
According to the details regarding the 2024 WazirX hack, attackers stole around $234 million worth of cryptocurrency from the exchange’s multi-signature wallets. After the incident, the hack was traced to the infamous Lazarus group, which was allegedly formed under the patronage of North Korea.
After the hack, the exchange had no choice but to put on hold all withdrawal and trading activities on its platform due to security reasons.
According to WazirX, over 85% of all funds belonging to the eligible users are now paid back within the scope of the company’s recovery plan, but some other recoveries can be helped by profits made from the new futures business segment.
Moreover, WazirX estimates that the contribution of this segment to the revenue stream may reach almost 50%.
Why Futures Trading Is Crucial for Crypto Exchanges
As mentioned above, crypto futures trading turned into the biggest source of income for exchanges around the world. In contrast to spot trading, futures trading allows people to bet on asset price changes thanks to the possibility of using leverage.
Companies like Binance and Bybit managed to establish their positions precisely due to providing derivatives products. Meanwhile, the launch of futures by WazirX is rather necessary than additional.
It is assumed that experienced traders are particularly attracted to derivatives products since they provide people with chances to earn regardless of market conditions. However, there are higher risks associated with the use of futures.
Thus, to ensure customers’ responsible approach, WazirX implemented mandatory educational exams prior to granting futures trading permission.
This step can be seen as an effort made by the firm to ensure that they come off as a responsible entity in the Indian crypto space.
Can WazirX Rebuild Users’ Trust?
The most important question at this point is whether crypto investors in India will consider using WazirX again.
The exchange was once the leading platform in India when it came to dealing with cryptocurrencies, but due to the hack, its reputation suffered badly. Many of its customers found fault with how the company handled the withdrawal process during that period.
According to several crypto experts, initiating futures trading immediately after the attack was not only bold but also imperative for the company. Some detractors feel that WazirX should prioritize rebuilding the trust of its clients before venturing into anything risky like futures trading.
However, many people support the decision taken by WazirX. The firm cannot afford to waste any more time because there is intense competition within the crypto space. Those firms which do not innovate fast enough lose out to foreign companies.
India’s Crypto Sector Faces a Crossroads
Furthermore, the effort to bounce back of WazirX represents the state of the crypto sector in India.
In spite of regulatory uncertainty and high taxes, the use of cryptocurrencies in India has continued to be robust, particularly among young investors. Yet, with fears of security threats and collapse of exchanges worldwide, the user base has become highly wary.
The WazirX heist was one stark lesson in the vulnerabilities of cryptocurrency systems. It further emphasized the mounting danger posed by cybercriminal gangs abroad that are hunting for opportunities to strike digital currency exchanges.
At present, all eyes are on WazirX’s turnaround story. In the event of a successful comeback, it might be seen as an indicator of renewed confidence in India’s crypto scene.
On the other hand, the failure to win back customer trust will only prolong the aftereffects of the 2024 disaster.
What’s Next
The announcement of futures trading by WazirX can be considered among the boldest comebacks in India’s cryptocurrency history. It seems that the company wants to move from a crisis mode to an innovation-oriented approach.
Nevertheless, cryptocurrency enthusiasts will probably have reservations about the platform for now since futures trading will help increase profits and trading volume, but only if the company manages to prove that users’ deposits are really safe.
Thus, the announcement of futures trading can be regarded as a step towards recovery by the exchange in the rapidly changing Indian cryptocurrency market.
