WazirX Parent Zettai Urges Singapore Court to Review WazirX Restructuring, Extend Moratorium

Zettai, the parent entity of the crypto exchange WazirX, has petitioned the Singapore High Court for a reassessment of its financial restructuring plan. In a fresh filing on June 6, Zettai requested the court to re-evaluate its dismissal of the scheme's implementation. This approval was initially slated to arrive on May 16; however, the court deflected the date ordering Zettai to complete further paperwork. At the time, neither Zettai nor WazirX had informed the creditors about the missing documentation that caused the setback.

WazirX shared a copy of the court filing with the users that was obtained by Gadgets 360 on Monday, June 9. The filing revealed that the Singapore High Court had found Zettai in breach of the Financial Services and Markets Act 2022 (FSM Act). According to the court, Zettai lacked the necessary Digital Token Service Provider (DTSP) license required to operate in Singapore.

In response, the company argued that it was not "carrying on a business" and therefore did not require a DTSP license. It added that the proposed restructuring scheme was a one-time asset distribution and not a commercial crypto service.

The filing also noted the court's earlier concerns — raised in May — about insufficient disclosure of information to WazirX users, which led to the rejection of the restructuring plan. Zettai countered this by stating it had shared adequate details to enable informed creditor voting, which resulted in 93.1 percent approval. The company also confirmed the establishment of a subsidiary, "Zensui," in the Republic of Panama.

"At the 4 June Hearing, JC Tan dismissed SUM 940 partly on the grounds that Zettai did not disclose the incorporation of Zensui in the Republic of Panama and the possible role that Zensui would play in the implementation of the Scheme prior to 4 June 2025. In this connection, JC Tan suggested that without such disclosure, scheme creditors could not make an informed choice on whether to vote for or against the Scheme," the filing added, saying that these details were omitted for not being material to the voting.

The company stated that while Zettai is currently responsible for distributing Non-Liquid Payment Assets (NLPA) as part of the first recovery token payout to WazirX creditors, it may transfer operational rights to Zensui, allowing the subsidiary to take over as WazirX's operator.

To address legal concerns and expedite reimbursements to affected creditors, Zettai has put forward two proposals for the court's consideration.

"The Court may order any amendment to the terms of the Scheme itself to resolve any potential ‘blots'. In the alternative, the court may order a re-vote on the Scheme after all information had been placed before the Scheme Creditors, with the result of this re-vote being determinative of the materiality of the additional information disclosed to voting," the petition proposes.

As of Monday, the court's response to the latest filing is still awaited.

Meanwhile, the moratorium period granted to Zettai and WazirX in Singapore expired on June 6. In its filing, the company has requested an extension of the moratorium, which has shielded both entities from creditor lawsuits while they worked on a reimbursement plan. The moratorium, initially granted in September last year, has already been extended at least once prior to this latest appeal.

The financial troubles stem from a major security breach in July 2024, when a multi-signature wallet belonging to WazirX was hacked, resulting in the loss of $230 million (roughly Rs. 1,900 crore) worth of user funds. WazirX has alleged that North Korean hackers were behind the attack. Despite launching White Hat bounty programs and initiating legal investigations, the stolen funds have yet to be recovered. Creditors have since voiced their frustration and disappointment across social media platforms.