WazirX Recovery Plan: $5.5 Billion Debt Issuance, Airdrops, and New Trading Features
WazirX Recovery Plan – WazirX, one of the largest cryptocurrency exchanges in India, has unveiled a comprehensive recovery plan aimed at making its creditors whole following a significant hack and operational suspension. Speaking during the company’s fourth town hall session on YouTube, WazirX co-founder Nischal Shetty outlined several key initiatives, including the introduction of a “recovery token” and plans to relaunch trading by February 2025.
WazirX’s Recovery Token: Airdrop to Creditors
In an effort to address the losses incurred during the exchange’s ongoing recovery process, WazirX will airdrop “recovery tokens” to creditors. These tokens will enable users to recover 48% of their lost funds by trading them on the platform. The tokens will be distributed on a pro-rata basis, meaning that creditors will receive recovery tokens proportional to the losses they sustained. This initiative is part of WazirX’s broader strategy to rebuild trust and support its users during the recovery phase.
Exchange Relaunch and New Features by 2025
As part of its recovery strategy, WazirX intends to relaunch trading by February 2025, with new features designed to drive revenue and support creditor recovery. The exchange will introduce crypto staking, an over-the-counter desk, and futures trading as new offerings to attract more users and boost platform activity. A portion of the fees generated through these services will be allocated toward the buyback of recovery tokens, helping to accelerate the recovery process for affected users.
WazirX Decentralized Exchange (DEX) in the Works
In addition to the upcoming trading features, WazirX is also in the early stages of developing a decentralized exchange (DEX). This DEX will operate alongside the main WazirX platform and will cater to growing demand for self-custody options from users who prefer to maintain control over their assets. Shetty explained that the new DEX would have a native governance token, enabling users to trade and earn rewards within the decentralized ecosystem, thereby enhancing both liquidity and user engagement.
A portion of the revenue generated from the DEX will be allocated to the recovery efforts, and users will also have the option to swap their recovery tokens for DEX tokens. This integration of a decentralized exchange is part of WazirX’s long-term strategy to diversify its services and attract a broader user base, while also reinforcing its commitment to recovery.
Fund Recovery and Partnerships with White Knight Investors
WazirX is not only focusing on new features but is also pursuing various efforts to recover funds that were lost during the hack. The exchange plans to recover funds by selling tokens held by third parties and is actively exploring partnerships with “white knight” investors to secure additional financing. In a recent post, WazirX emphasized its commitment to legal actions in order to reclaim illiquid and stolen assets, ensuring that any recovered funds will be secured for the benefit of its creditors.
WazirX Faces Legal Scrutiny and Ongoing Investigations
While WazirX works toward its recovery goals, the exchange continues to face intense regulatory scrutiny. India’s Financial Intelligence Unit (FIU) is reportedly investigating the exchange, which adds another layer of complexity to its ongoing recovery efforts. Additionally, the company is facing legal challenges from customers who are pursuing a class-action lawsuit with the National Consumer Disputes Redressal Commission (NCDRC) in India. WazirX is also dealing with two separate cases filed against the platform in the Delhi High Court.
$235 Million Hack and Recovery Efforts
WazirX’s recovery efforts stem from the aftermath of a $235 million hack that occurred in July 2024, prompting the exchange to suspend operations temporarily and pursue a restructuring process in Singapore, where its parent company, Zettai, is based. Since the hack, WazirX has been able to allow withdrawals for 55% of users’ cryptocurrency holdings and 66% of their cash deposits, with the remainder of funds still inaccessible.
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