WazirX’s Restructuring Plan Declined by Singapore Court, Hacked Indian Exchange Says

WazirX’s Restructuring Plan Rejected by Singapore High Court, Delaying Creditor Payments

WazirX, the embattled Indian cryptocurrency exchange, has suffered a significant setback in its efforts to repay creditors. The Singapore High Court rejected the exchange’s proposed restructuring plan, effectively halting any anticipated payouts that were slated to begin as early as April 2025.

In an email to creditors, WazirX acknowledged the court’s decision, stating that while the outcome was unexpected, they remain committed to complying with all legal and regulatory processes and prioritizing the commencement of distributions as soon as possible.

The court’s initial approval of WazirX’s plan in January followed the exchange’s application for protection from liquidation after a devastating $230 million hack attributed to North Korea’s Lazarus Group. The approved scheme included a creditor vote on the plan, with payouts promised within ten business days of activation. Further components of the plan involved launching a decentralized exchange (DEX), issuing recovery tokens, and implementing periodic buybacks to enhance liquidity.

However, the court’s recent rejection throws the creditor repayment timeline into significant uncertainty. Failure of the restructuring could lead to liquidation under section 301 of the Singapore Companies Act. This would likely result in a fire sale of remaining assets, significantly reducing compensation for creditors.

WazirX has faced substantial criticism for its slow communication and limited progress in asset recovery. Restrictions on user interaction with the exchange’s social media accounts have further fueled dissatisfaction. Once a dominant player in India’s cryptocurrency trading market, WazirX now faces questions regarding its future and the potential recovery of funds for its users. The court’s decision leaves creditors in a precarious position, with the possibility of substantially reduced payouts looming large. The situation highlights the complexities and risks inherent in the cryptocurrency market and the potential consequences of significant security breaches. The lack of transparency and communication from WazirX has further exacerbated the concerns of affected users, who are left uncertain about the future of their investments. The legal battles ahead will determine the final outcome for both WazirX and its creditors.