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WazirX’s restructuring plan, approved by the Singapore High Court, paves the way for restoring user funds stolen in a $235 million hack linked to North Korea’s Lazarus Group.
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Indian cryptocurrency exchange WazirX has secured approval from the Singapore High Court for its restructuring plan, enabling the repayment of customer funds stolen in a massive cyberattack in July 2024.
On Jan. 23, the Singapore High Court approved WazirX’s plan under the Companies Act 1967, paving the way for the crypto exchange to recover from a $235 million cyberattack by North Korea’s Lazarus Group.
Filed by Zettai, WazirX’s parent company, the restructuring plan aims for creditor recovery and avoiding liquidation through a court-supervised process. WazirX estimates that users may recover 75% to 80% of their account balances through token distributions.
According to the court hearing, there was no evidence of WazirX’s wrongdoing or misconduct in the cyberattack.
This followed a joint statement from the US, Japan and South Korean governments linking North Korea’s Lazarus Group to a breach of WazirX’s platform.
WazirX will initiate a user voting process, which is expected to conclude within three months, along with an independent third-party audit. If the majority votes in favor, the scheme will be implemented, and within 10 days, net liquid assets will be distributed to users based on their claims, including any gains from the bull market.
The court noted that a speedy resolution and quick distribution of funds would be the best outcome for users. It also supported restructuring over liquidation, citing financial projections from Kroll, a third-party auditor.
As part of its recovery efforts, WazirX froze $3 million USDt (USDT) on Jan. 17 from stolen funds. Collaborative efforts with US, Japanese and South Korean authorities are ongoing to recover additional assets tied to the attack.
Related: Crypto hacks, scam losses reach $29M in December, lowest in 2024
Restructuring plan
The restructuring is being carried out under a Singapore Scheme of Arrangement, a legal framework that allows companies to propose binding agreements with creditors.
The exchange plans to repay users affected by the cyberattack by introducing recovery tokens. These tokens represent remaining claims and allow creditors to benefit from future platform profits and recovered assets.
Initial payouts are set to be completed within 10 business days after the scheme is approved and activated. The remaining claims will be tied to recovery tokens, which will be periodically repurchased using platform profits and revenues from a planned decentralized exchange that WazirX aims to launch.
Zettai has also committed to a three-year buyback program for recovery tokens financed by profits and recoveries from stolen or illiquid assets.
Magazine: Big moves expected for crypto in Asia in 2025: Asia Express
This article first appeared at Cointelegraph.com News
