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WazirX has implemented a Singapore-backed restructuring plan to recover from its July 2024 $235 million cyberattack.
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Indian cryptocurrency exchange WazirX, which suffered a $235 million cyberattack in July 2024, has announced a restructuring plan aimed at compensating affected users.
The exchange, reportedly targeted by North Korea’s Lazarus Group, has outlined the plan under the supervision of Singapore’s legal system.
Zettai, the parent company managing WazirX, filed for a moratorium at the Singapore High Court in August 2024, proposing a restructuring plan under a Singapore Scheme of Arrangement.
A Singapore Scheme of Arrangement is a court-approved legal process companies use to restructure their debts and liabilities. It allows the company to propose a binding arrangement with creditors, ensuring resolution while avoiding liquidation.
As of December 2024, WazirX reported liquid assets of $566.38 million USDt (USDT), exceeding the total claims of $546.47 million USDT filed by users in July 2024.
The company has also introduced recovery tokens to settle outstanding claims, allowing creditors to benefit from profits generated by future platform operations and recovered assets.
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Focus on recovery
WazirX founder Nischal Shetty described the restructuring as a step toward restoring user trust.
“Our swift filing for the moratorium and application to the court for a Scheme process was a decisive step taken for the benefit of users so they can receive distributions as soon as possible,” Shetty told Cointelegraph. “Token distributions will be made shortly after the Scheme is approved by creditors and sanctioned by the court […] my number one goal is to add more value than what was stolen.”
WazirX shows a 45% asset deficit compared to liabilities, highlighting a 55% asset-to-claims ratio. Source: WazirX
The company said it would be returning funds through token distributions, which could yield 75% to 80% of the value of users’ account balances at the time of the cyberattack.
Initial distributions will be completed 10 business days after the scheme is approved and is effective.
The remaining creditor claims will be represented by recovery tokens, which will be periodically repurchased using profits generated from platform operations and a proposed decentralized exchange (DEX).
WazirX also plans to launch a DEX to generate additional profits and settle outstanding claims.
Related: Crypto hacks, scam losses reach $29M in December, lowest in 2024
CoinSwitch capitalizes on the hack
Indian cryptocurrency exchange and WazirX competitor CoinSwitch has announced a recovery fund aimed at supporting victims of the WazirX cyberattack.
CoinSwitch took to X on Jan. 7 to officially announce the launch of a WazirX hack recovery fund of 600 crore Indian rupees ($69.9 million) called “CoinSwitch Cares,” the company’s recovery fund.
Notably, CoinSwitch is also pursuing legal action against WazirX to recover 2% of its funds stuck with WazirX, cumulatively amounting to 12.4 crore rupees ($1.44 million).
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This article first appeared at Cointelegraph.com News
