WazirX Reorganization Plan Approved: Customers to Recoup Majority of Funds
The Singapore High Court has approved the reorganization plan of Indian cryptocurrency exchange WazirX, allowing it to return customer monies that were taken in a significant cyberattack in July 2024. The Singapore High Court granted WazirX’s proposal under the Companies Act 1967 on January 23, opening the door for the cryptocurrency exchange to bounce back from a $235 million cyberattack by the Lazarus Group of North Korea.
The restructuring plan, which was submitted by Zettai, the parent company of WazirX, seeks to avoid liquidation and collect creditors through a court-supervised procedure. According to WazirX, token payouts might allow customers to recoup between 75 and 80 percent of their account balances.
No proof of WazirX’s malfeasance or misconduct in the cyberattack was presented at the court hearing. In a joint statement, the governments of the US, Japan, and South Korea connected a breach of WazirX’s platform to North Korea’s Lazarus Group.
WazirX to Distribute Recovery Tokens Within 10 Days of Plan Approval
In addition to an impartial third-party audit, WazirX will start a user voting process that should be finished in three months. The plan will be put into effect if the majority votes in favor of it, and consumers will receive their net liquid assets—including any profits from the bull market—based on their claims within ten days. The court stated that the optimum course of action for consumers would be a prompt conclusion and prompt allocation of monies. It also cited Kroll’s financial estimates to favor reorganization rather than liquidation.
A Singapore Scheme of Arrangement, a legal framework that enables businesses to suggest legally enforceable arrangements with creditors, is being used to carry out the restructuring. Through the introduction of recovery tokens, the exchange intends to compensate users impacted by the cyberattack. These tokens serve as a representation of outstanding claims and give creditors access to recovered assets and potential platform revenues.
Ten working days following the scheme’s approval and activation, the first rewards are scheduled to be made. Recovery tokens, which will be periodically repurchased using platform profits and income from a planned decentralized exchange that WazirX hopes to build, will be linked to the remaining claims.
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