WazirX Restructuring Plan Rejected By Singapore High Court; Crypto Firm to Appeal Decision

WazirX users who lost their funds in the $230 million (roughly Rs. 1970 crore) hack last year, may have to wait longer to receive reimbursements from the crypto exchange. On Wednesday, the High Court of Singapore rejected WazirX's restructuring scheme, according to an update posted by the exchange on X (formerly Twitter). This restructuring scheme, according to WazirX, was approved by a majority of its creditors in April. However, the crypto firm has failed to get the approval of the court, which is required to execute this scheme.

In its post on X, WazirX said that it did not anticipate this outcome. "Our primary focus remains to begin distributions as soon as possible. Towards this goal, we are currently evaluating all available legal options in consultation with our legal and advisory teams, and will be appealing against the decision of the Singapore High Court," the firm said.

Zettai, WazirX's majority stakeholding entity, is registered in Singapore. After one of its multi-sig wallets under Liminal Custody's oversight was allegedly hacked last year, the exchange moved a Singapore court for a moratorium and sought approval from its users for a restructuring scheme. Zettai has worked with financial restructuring firm Kroll to design its reimbursement roadmap in Singapore.

In January, the court reviewed the restructuring scheme and allowed the firm to approach creditors.

Four months later, Zettai said 141,476 creditors participated in the voting process and a majority — 131,659 voters (or 93 percent) — approved the plan.

On May 16, the court deferred the case to another date and directed WazirX and Zettai to submit additional documentation. At the time, the court also extended the exchange's moratorium until June 6. It's currently unclear whether WazirX will appeal for another extension that has safeguarded it against new legal cases.

"Today's decision does not impact the NLPA (net liquid platform assets), which remain safe. More updates will follow in due course," the exchange said in its post on X.