WazirX Secures Landmark Singapore Court Approval for Debt Restructuring - CEO Confirms Major Exchange Revival

Singapore court greenlights WazirX restructuring - exchange gets second chance at redemption

BREAKING: Crypto Exchange Wins Legal Lifeline

WazirX just dodged a bullet that would make traditional finance bankers blush. The Singapore High Court approved their debt restructuring scheme, giving the embattled exchange breathing room to rebuild.

CEO Nischal Shetty confirmed the ruling, marking a crucial victory for the Indian-based platform that faced potential collapse. The decision allows WazirX to reorganize its financial obligations while maintaining operations.

Restructuring Plan Clears Major Hurdle

Court approval means creditors can't come knocking while WazirX implements its recovery strategy. The exchange now has legal protection to negotiate with stakeholders and restructure existing debts without facing immediate liquidation threats.

Singapore's nod adds international credibility to the process, potentially attracting new investment and partnership opportunities. The jurisdiction's reputation for robust financial regulation gives the restructuring additional weight.

Exchange Fights Back Against Market Headwinds

This legal win comes at a critical juncture for crypto exchanges globally. While traditional finance institutions would've folded under similar pressure, WazirX demonstrates crypto's resilience - or maybe just its stubborn refusal to die like a proper decentralized protocol should.

The approval sets precedent for other struggling exchanges seeking legal protection in creditor-friendly jurisdictions. Watch how quickly Wall Street firms start eyeing similar strategies for their next bailout.

Singapore Court Approval Caps Months Of Negotiations And Plan Revisions

The court’s decision follows months of creditor engagement and revisions to the company’s original proposal. In August, more than 95% of WazirX’s creditors voted in favour of the updated scheme, filed by its Singapore-based parent company, Zettai Pte Ltd.

The vote accounted for about $206.9m in validated claims from more than 149,000 account holders.

Under the restructuring plan, WazirX aims to redistribute the remaining assets fairly, in line with Singapore’s Insolvency, Restructuring and Dissolution Act of 2018.

To achieve this, the exchange chose a court-supervised Scheme of Arrangement instead of liquidation. This approach helped avoid years of delays — liquidation could have postponed recoveries until 2030 or later.

Now that the court has approved the plan, WazirX can begin returning assets and gradually reopening trading services.

According to company filings, the first round of token distributions will begin within 10 business days of the scheme taking effect.

If all goes as expected, users could recover about 85% of their account balances, based on valuations from the date of the hack.

Revised Scheme Clears Hurdles With Over 95% Creditor Approval

The road to approval was not smooth. Initially, in March, more than 93% of creditors backed WazirX’s restructuring plan. However, in June, the Singapore High Court rejected the proposal due to regulatory concerns over token distributions.

In response, WazirX revised the plan. The new version routed repayments through its Indian entity, Zanmai Labs, which is registered with the country’s Financial Intelligence Unit.

As a result, the updated proposal gained even stronger support in the second vote, held between July 30 and Aug. 6. The process, coordinated by Kroll Issuer Services, was limited to users who held positive account balances as of July 18, 2024.

Encouragingly, the high level of participation reflected renewed confidence in WazirX’s recovery plan after months of uncertainty.

Meanwhile, Zettai Pte Ltd, acquired by Binance in 2019, played a pivotal role throughout the restructuring. The Singapore entity retained custody of WazirX’s crypto assets and liabilities, while Zanmai Labs continued to oversee fiat operations in India.

WazirX Eyes Swift Return Of Trading And Withdrawals Post-Approval

Following the hack, Zettai sought a moratorium from the Singapore High Court. The goal was to protect against global creditor actions and prevent assets from being split across jurisdictions.

With the moratorium in place, WazirX was able to consolidate its restructuring under Singapore law. This ensured that both Indian and international users WOULD be treated uniformly. Moreover, it reduced the risk of conflicting legal claims — a key issue after several Indian users questioned the applicability of WazirX’s terms of service.

The hacking incident had caused heavy losses and frozen withdrawals, pushing the exchange close to insolvency. However, the court-approved restructuring plan now offers a clear path to stabilize operations and rebuild user trust.

If all goes as planned, WazirX could resume trading and withdrawals within days of the scheme taking effect.