An Indian court just blocked crypto exchange WazirX</b><b>WazirX</b>">WazirX from taking a user’s XRP tokens to cover losses from their massive hack last year. The Madras High Court ruled that the user’s 3,532 XRP tokens worth about $9,400 are their own property and can’t be touched to pay for the exchange’s problems.

This whole mess started after WazirX got hacked for $235 million back in July 2024. The exchange tried implementing a “socialization of losses” plan where they’d spread the losses across all users, even people who held completely different cryptocurrencies that had nothing to do with the stolen tokens.

Judge N. Anand Venkatesh wasn’t having it. He ruled that XRP and the stolen ERC-20 tokens are completely separate assets and can’t be lumped together. The user bought their XRP way before the hack even happened, so why should they pay for it?

The court made WazirX either deposit about $11,500 in escrow or provide a bank guarantee while arbitration plays out. This decision is pretty huge because it confirms cryptocurrency is legally recognized property that’s protected under Indian law.

WazirX just resumed operations last week after getting court approval for their restructuring plan following 16 months offline. They blamed the hack on North Korea’s Lazarus Group exploiting weaknesses in their multi-signature wallet setup.

Conclusion

The Madras High Court blocked WazirX from using customers’ XRP to cover $235 million in hack losses, affirming cryptocurrency as protected property under Indian law.

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