What You Should Know:

• The WazirX exchange, having suffered a $230 million hack, has received over 93% approval from creditors for a proposed restructuring plan.
• The voting process, which engaged over 141,000 creditors, surpassed the requirements outlined in Singapore’s Companies Act, averting a move towards liquidation.
• If approved by the Singapore Court, this restructuring plan will initiate payouts and resume withdrawals while aiming towards establishing a decentralized exchange and issuing recovery tokens.

WazirX has successfully garnered over 93% of votes from its creditors for a Scheme of Arrangement. This plan seeks to provide a pathway for partial recovery of the assets lost in a hack that occurred in July 2024.

The voting, held on Kroll Issuer Services platform from March 19 to March 28, involved claims amounting to $195.65 million from more than 141,000 creditors.

Among those, 131,659 creditors, representing $184.99 million, approved the plan, which equates to 93.1% by count and 94.6% by value. The threshold set by Singapore’s Companies Act requires a majority by count and a value threshold of 75% for approval.

Had the scheme not been passed, it would have led to a shift towards liquidation, significantly lowering the recovery for creditors, pushing potential restitution timelines to 2030. With these results, Zettai, the parent company of WazirX, plans to petition the Singapore Court for sanctioning. Once approved, the plan would trigger initial payouts within 10 business days, followed by a gradual resumption of withdrawals and trading, all under necessary regulatory oversight.

Part of the recovery strategy includes launching a decentralized exchange (DEX), creating recovery tokens for trading, and initiating a buyback of these tokens through platform profits and new revenue sources.

This comes in the wake of a major security breach led by the Lazarus Group, in which over $230 million was lost after an attack that intercepted private keys. WazirX attributed this breach to its custody provider, Liminal, while the latter has denied these claims, citing vulnerabilities within WazirX’s own security systems.

The hacker managed to launder the stolen funds through various addresses using Tornado Cash, which obscured the transactions. Since then, WazirX has been actively working on recovery efforts but has seen limited success.