Kyrgios was fined $10,000 and sparked a global uproar after telling Wawrinka during a match in Montreal this week that Australian tour rival Thanasi Kokkinakis had slept with Donna Vekic.
Wawrinka has been romantically linked with the 19-year-old Croatian, who played mixed doubles with Kokkinakis at the Australian Open last year.
A furious Wawrinka demanded the ATP take action against Kyrgios, who later issued a public apology but faces the threat of suspension from the tour.
Pundits and top players, including world number one Novak Djokovic, have queued up to criticise Kyrgios but the response from Australia’s tennis establishment has been far more sanguine.
Tennis Australia issued a statement saying that Kyrgios and his team needed “support”, while Masur played down the sledge as “not confrontational” and said he was still in Australia’s Davis Cup plans for their semi-final against Britain next month.
“How punitive can you be? At what point do you start to move forward?” Masur told local broadcaster Fox Sports.
“Nick is paying a very heavy price financially. Obviously the consequences will go beyond this week, for example amongst his peers on the tour, the ATP player council, they’ll have their say.”
However former Australian great Judy Dalton says the player should be banned from Davis Cup and the upcoming U.S. Open over his “disgraceful” comments.
“He’s a professional tennis player and you just don’t behave like that,” she said on Channel Nine’s TODAY show. “It’s no use fining him — he just says, ‘well I can afford to pay the fine, why should I worry about it?’
“For the women, it’s just so disgraceful. To Donna, it is so demeaning for her, and I think that it doesn’t encourage women to come into the sport, certainly not the junior girls if they’re going to put up with that.”
Kyrgios, who has made over $700,000 in prize money alone this year, was also fined $2,500 by the ATP for a comment made to a ball-kid during his match against Wawrinka and has alienated fans previously with his behaviour, not least at Wimbledon this year when he appeared to “tank” a game by not trying following a disputed call.
The $12,500 total for the fines is a fraction of the $44,600 he earned from reaching the tournament’s third round.
“We’re looking at a young kid, he’s got enormous potential, he’s a good kid at heart,” Masur added. “We’re trying to put things in place behind the scenes that can make a difference and help Nick achieve that potential.
“Nick polarises opinion but there have been a lot of young prodigies come onto tour that have been exactly the same.
“Look at John McEnroe, he was the superbrat who ended up becoming one of the most loved players in the game. Nick is on a journey… this is all part of a learning curve.”
Kyrgios, who later apologised on his Facebook page saying his comments had been “unacceptable on many levels”, was jeered onto the court and during his third-round loss to American John Isner by spectators at the Montreal tournament on Thursday.
His brother Christos was on Friday kicked off a Sydney radio station for comments he made while defending Kyrgios.
(Reporting by Ian Ransom; editing by Sudipto Ganguly/Mitch Phillips)