The Singapore High Court has given its approval to Zettai Pte Ltd to convene a meeting with creditors of the crypto exchange WazirX, marking a significant milestone in the company’s efforts to address debts and recover from the $230 million hack linked to North Korea’s Lazarus Group.
The court’s decision also includes granting a 16-week moratorium to Zettai, providing protection from legal actions while the company works on implementing its restructuring plan. Creditors will have the opportunity to review the proposed Scheme of Arrangement, which outlines how assets will be distributed and how the platform can resume operations.
In an effort to encourage wider participation among WazirX users, the court has allowed adjustments to the meeting process. Despite allegations from some creditors that Zettai was complicit in the cyberattack, the court dismissed these claims due to a lack of evidence. Investigations conducted by the US, Japan, and South Korea have identified the Lazarus Group as the perpetrators of the breach, a fact acknowledged by the court in its ruling.
Zettai has reiterated its commitment to transparency and has promised to expedite recoveries for creditors. WazirX founder Nischal Shetty has expressed optimism about the proposed restructuring plan, stating that it presents the best opportunity for creditors to recover their assets and for the platform to rebuild.
The reorganization plan involves restructuring debts, distributing liquid assets to creditors, and issuing recovery tokens to facilitate further asset retrieval. Additionally, the plan includes the relaunch of the WazirX platform with enhanced features like a decentralized exchange, with future profits allocated towards creditor recoveries over the next three years.
The creditors’ meeting will be conducted online, with details of the voting process to be provided in the upcoming weeks. Zettai has urged creditors to support the scheme, emphasizing that it offers a more favorable outcome compared to alternative options.
Industry analysts view Zettai’s efforts as a test of Singapore’s legal framework for resolving complex financial disputes in the digital asset space. A successful restructuring of WazirX could potentially serve as a model for other companies facing similar crises.