wazirx Restructuring Plan Faces Further Delay Amidst Court Review
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Compensation Scheme for Hack Victims Stalls
The proposed restructuring scheme by Wazirx, intended to compensate users affected by the important hack in July 2024, has encountered further delays. Despite a majority vote in favor of the plan by creditors, the Singapore High Court has postponed its decision, requesting additional documentation from both Wazirx adn its parent company, Zetta.
Court Extends Moratorium, Providing Temporary Relief
The Singapore Court has extended the moratorium covering Wazirx and Zetta until June 6th.A moratorium provides legal protection, allowing debtors to temporarily postpone payments to creditors and shielding them from new legal actions. Zetta initially sought this moratorium in August 2024, which has been prolonged from an initial 30-day period.
Creditor Frustration Mounts Amidst uncertainty
Wazirx addressed the delay on X (formerly Twitter), but the update appears to have intensified frustration among creditors. User responses to the post were largely critical, reflecting growing impatience wiht the drawn-out process. The exchange maintains that it is “doing its best to make it possible according to an effective scheme.”
If you want to repay the money….Why is a court permit? … If you don’t want to repay… You deny… Why are you going around and round? How can you alive our money with you… There is some shame .. the comment section is also disabled ..why?
VSM (@Range_13) May 16, 2025
Details of the Proposed Restructuring
Last month, Wazirx reported that 93% of creditors had approved the proposed restructuring scheme. This plan involves issuing traded recovery tokens (RTs) and distributing compensation through a mechanism that includes buying back these RTs. Zetta reported that 141,476 creditors, with claims exceeding $195 million (approximately ₹1,673 Crore), participated in the voting process.
The company had intended to begin distributing the RT tokens within seven business days of receiving court approval. However, creditors must now wait until at least june 6th for a potential resolution.
Background: The 2024 Security Breach
The restructuring plan is a direct response to a significant security breach that occurred on July 18,2024. A multi-signature wallet managed by Liminal Custody, holding approximately $230 million (₹1,900 Crore), was compromised. Investigative reports have linked the attack to north Korean hackers. Despite announcing a white hat initiative, Wazirx has yet to recover the stolen funds.
Cybersecurity incidents in the cryptocurrency space are a growing concern. According to a recent report by Chainalysis, cryptocurrency-related crime reached an all-time high in 2024, with losses exceeding $20 billion globally. Exchanges are increasingly under pressure to enhance thier security measures and protect user assets.
