WazirX, once India’s largest crypto exchange by trading volume, has secured a crucial extension from Singapore’s High Court as it struggles to recover from a devastating $234 million hack and a year of growing user frustration.
In a statement posted on social media, WazirX confirmed that the court will allow it to present new arguments supporting a revised restructuring plan and has extended the moratorium shielding the company from creditor lawsuits until a ruling is made.
The legal reprieve buys WazirX time to salvage its controversial Scheme of Arrangement, a court-supervised process intended to reorganize its operations and settle claims from creditors and over 400,000 affected users worldwide.
The exchange’s troubles began in July 2024, when hackers exploited security flaws to drain digital assets from customer wallets, making it one of the largest breaches to hit an Asian crypto platform that year.
In the months that followed, WazirX’s promises to reimburse users ran aground amid unclear communication, internal disputes with parent firm Zettai Pte Ltd, and growing concerns from regulators about fund tracing and governance.
To reassure creditors and regulators, WazirX has floated a plan to transfer its core business to a new entity, Zensui Corporation, registered in Panama.
The company said this would help distance the exchange from Zettai’s lingering corporate complications and give it the flexibility to issue so-called recovery tokens, blockchain IOUs pegged to unrecovered balances.
These tokens are intended to help users gradually reclaim between 75% and 80% of the crypto lost in the breach, with the actual payout tied to future market conditions and platform revenue. However, for many, the tokens are an untested solution that does little to guarantee timely restitution.
Despite these uncertainties, more than 93% of voting creditors backed the restructuring plan in April. However, the Singapore High Court declined to grant final approval last month, citing gaps in transparency and governance.
Without an approved plan, WazirX faces the prospect of forced liquidation. Legal experts warn that a court-ordered wind-down could drag on for years, consume significant funds in legal fees, and leave creditors with lower overall recovery rates. In a worst-case scenario, the exchange has warned that user repayments could be pushed back as far as 2030.
Friday’s extension marks what many see as the final opportunity for WazirX’s leadership to convince the court, and its wary community, that a structured recovery is still possible.
The exchange said in its statement:
“We are awaiting the court’s directions on the next hearing and will share updates as soon as we have clarity.”
No date has been announced for the next proceedings, leaving thousands of users still locked out of their accounts for nearly a year.
The exchange now faces a fragile path forward, balancing court demands for governance reforms with the urgent need to restore customer trust in an industry still reeling from high-profile collapses like FTX and Zipmex.
For users, the extension provides a flicker of hope but few guarantees, and until the court signs off on a final plan, their crypto remains out of reach.
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