WazirX users affected by the July hacking incident may have to wait a long time for clarity on compensation. In a recent update, Zettai announced plans to present its proposed financial restructuring plan in the Singapore Court on January 22, 2025. Zettai, the Singapore-registered entity that manages WazirX’s crypto assets and oversees the Indian exchange, suffered a loss of more than $230 million (roughly Rs. Rs 1,900 crore in the 18th July attack. Since the hack, WazirX is yet to fully restore its services and is facing intense criticism on social media.
In a statement to Gadgets 360, Zettai confirmed that it is awaiting Singapore court approval to present its restructuring plan to creditors. This means that WazirX creditors may have to wait for at least another month before paying any compensation.
If the court allows the proposal to proceed, the plan will need at least 75 percent approval from creditors to take effect. The restructuring plan will be implemented only with this majority vote.
Amid growing criticism, WazirX has disabled comments on its posts on X.
:loudspeaker: the way forward
We are moving step-by-step towards recovery – if the plan is approved by the scheme lenders:
» We are trying to get court approval for the plan in the earliest possible time frame.
» Subject to legal and regulatory requirements, the platform will resume… pic.twitter.com/kIyYZmHs0v– WazirX: India’s Bitcoin Exchange (@WazirXIndia) 19 December 2024
Zettai highlighted that if creditors reject the proposed restructuring plan, liquidation is the only option for WazirX.
Emphasizing that approval of the plan is the fastest path to recovery of funds for creditors, Zetai said, “Under a liquidation, the earliest distributions creditors can receive is in two to three years, allowing recovery There is also a possibility of reduction in. For the costs of liquidation.”
If liquidation becomes necessary, WazirX would first have to resolve its ongoing dispute with Binance, which the company describes as confidential and undetermined. The WazirX-Binance dispute began around 2021 when both parties initially said that Binance had acquired WazirX. However, in 2022, Binance refused to complete the acquisition, while WazirX maintained that Binance was its owner. This ambiguity has persisted for nearly two years and may take additional time to resolve.
As a result, WazirX creditors face waiting times ranging from two months to three or more years before receiving compensation.
Key details of WazirX’s planned restructuring plan
As part of its restructuring plan, WazirX intends to issue recovery tokens to its creditors. These tokens can be traded during the ongoing bullish trend in the market, where BTC is fluctuating between $97,000 (approximately Rs 82.6 lakh) and $108,000 (approximately Rs 91.7 lakh).
Earlier this month, the exchange had said that, “The net available liquid funds under its planned scheme, which currently represent more than 100 per cent of the USD value of liabilities as of July 18, 2024, will be distributed in proportion to the creditors of the scheme.” The remainder will be distributed.” into their portfolio, ensuring that they will benefit from the ongoing crypto bull run.
The exchange has not yet provided details about the plan, which is expected to be revealed after January 22, 2025. However, it added that if the scheme is approved, the initial fund distribution will begin within 10 business days.
Five months after the hack, the funds stolen from WazirX accounts have not been located and have not been recovered. In November, WazirX founder Nischal Shetty announced plans to develop India’s first decentralized exchange within the next twelve months.
