Singapore High Court Overturns Decision on WazirX Restructuring
In a significant turn of events, the Singapore High Court has overturned its earlier decision from June 4, 2025, which had dismissed WazirX’s proposed restructuring initiative. This latest ruling allows for a new vote by creditors on a revised recovery plan. The court’s decision potentially paves the way for the beleaguered exchange to resume operations and start the process of returning funds to users impacted by a massive $230 million hack that occurred in July 2024.
Implications of the Ruling
As a result of this ruling, Zettai, the parent company of WazirX, has received an extension on its moratorium protection while the court accepted further arguments presented by the company. Should the updated scheme gain the necessary backing from creditors along with judicial endorsement, WazirX is expected to relaunch, with operations managed by Zanmai in accordance with Indian law.
This latest ruling represents a stark reversal of the previous denial, which stemmed from a lack of transparency regarding Zettai’s unexpected move to Panama and its subsequent rebranding as Zensui Corporation. This initial refusal left the exchange in a precarious position, exposing it to potential legal actions in India and preventing users from accessing their funds for nearly a year.
Future Plans and User Compensation
Nischal Shetty, the founder of WazirX, has indicated that a Proof of Reserves will be introduced when the platform restarts, clarifying that current balances remain unaffected due to a halt on deposits and withdrawals. An independent auditor has already verified the exchange’s current crypto holdings and submitted the findings to both the court and creditors.
WazirX had previously aimed to restore 85% of user balances by issuing recovery tokens linked to unrecovered assets, but legal disputes and resistance from investors have significantly delayed this process, leading to widespread frustration among users about the lack of transparency and repeated postponements.
Legal and Regulatory Context
The High Court’s recent ruling to facilitate a revote comes after months of uncertainty surrounding WazirX’s plans. The court had previously rejected WazirX’s restructuring proposal amid concerns over Zettai’s corporate transformations and location switching. The company had earlier secured a four-month conditional moratorium in September 2024, shielding it from litigation across diverse jurisdictions.
The June 4 rejection had opened doors for Indian customers to pursue legal recourse within their country to attempt to retrieve locked funds. WazirX had warned its users in February about potential delays in repayments, which could be extended as far as 2030 without the restructuring plan’s approval, casting doubts on the company’s future viability.
Alternatively, a successful restructuring would enable more structured and expedited repayments, along with possible profit-sharing arrangements for the users. While an impressive 93% of voting creditors had previously expressed support for the initial restructuring plan in April 2025, its implementation has stalled due to ongoing legal complications and Zettai’s hesitance.
Security Concerns and User Trust
This amended plan aims to mitigate court concerns while preserving key aspects of user compensation. Amid this backdrop, the Monetary Authority of Singapore issued a directive on May 30, mandating that all unlicensed exchanges in Singapore must discontinue operations by June 30. Zettai’s corporate transitions were purportedly made to comply with regulatory requirements.
The backdrop of this saga includes the staggering hack of WazirX in July 2024, where attackers exploited weaknesses in the exchange’s multisig wallet system, successfully tricking authorized personnel into approving a harmful contract that resulted in the siphoning of around $230 million in cryptocurrency assets. This incident also highlighted ownership disputes between Zettai and Binance regarding the management of WazirX, complicating the restructuring efforts further.
Users are calling for increased transparency and the implementation of Proof of Reserves to avert similar security breaches in the future.
Recovery Tokens and User Expectations
WazirX plans to distribute recovery tokens as digital IOUs representing unrecovered funds, which may allow users to reclaim between 75% and 80% of their affected balances, depending on market conditions. However, the issuance of these tokens is contingent upon the successful execution of the restructuring.
The exchange is committed to expediting the revoting process, with hopes that distributions will commence soon if the amendment receives the green light from the required parties. Users are now eagerly anticipating specific timelines for both the voting and the potential reopening of a platform that has remained closed for close to a year.
