In simpler terms, after experiencing a significant cyber-incident that cost them $235 million back in July 2024, Indian cryptocurrency platform WazirX has unveiled a reorganization strategy intended to provide relief to those impacted by the attack.
The exchange, allegedly being targeted by North Korea’s Lazarus Group, has detailed its strategy, overseen by Singapore’s judicial system.
In August 2024, the overarching organization, Zettai, applied for a pause on legal proceedings at the Singapore High Court. This application aimed to initiate a reorganization strategy under a Singapore-based plan called a Scheme of Arrangement.
In simpler terms, a Singapore Scheme of Arrangement is a legally-sanctioned procedure that businesses can utilize to reorganize their outstanding debts and obligations. This process enables the company to put forward a binding agreement with its creditors, facilitating a resolution without resorting to liquidation.
By the end of December 2024, WazirX stated their liquid assets amounted to approximately $566.38 million USDt (USDT), which surpassed the total user claims of $546.47 million USDT submitted in July 2024.
The business has additionally launched recovery tokens to resolve overdue debts, giving creditors the ability to profit from future earnings and recovered resources generated by the platform’s ongoing operations.
Focus on recovery
WazirX founder Nischal Shetty described the restructuring as a step toward restoring user trust.
Shetty informed CryptoMoon that we took a crucial action by promptly submitting our request for a moratorium and initiating the Scheme process in court. This move was primarily for the advantage of our users, enabling them to receive their distributions as quickly as possible. Token distributions are expected soon after the Scheme receives creditor approval and is sanctioned by the court […] my top priority remains creating more value than what was lost.
The company announced that they will give back user funds by distributing tokens, potentially amounting to 75% to 80% of the balance each user had before the cyber-incident.
The initial distributions will be finalized ten working days following the approval and activation of the program.
The leftover claims of creditors will be symbolized as Recovery Tokens. These tokens will be regularly bought back with earnings produced by the platform’s operations and a proposed Decentralized Exchange (DEX), serving as a method to repurchase them periodically.
WazirX also plans to launch a DEX to generate additional profits and settle outstanding claims.
CoinSwitch capitalizes on the hack
CoinSwitch, a rival Indian cryptocurrency platform, has declared the establishment of a recovery fund to aid those affected by the WazirX cyber-incident.
On January 7, CoinSwitch unveiled the “CoinSwitch Cares” fund, a WazirX hack recovery initiative worth approximately 600 crore Indian rupees ($69.9 million). This announcement marked its official launch.
Significantly, CoinSwitch is taking steps to sue WazirX in order to retrieve approximately 12.4 crore Indian rupees (or around $1.44 million) that are currently frozen with the platform.
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2025-01-10 11:51