Singapore Court Approves WazirX’s Request to Retrieve User Funds
Indian cryptocurrency exchange WazirX became embroiled in controversy after Pakistan’s Bitbns claimed it had offered to acquire the platform.
The Singapore High Court has approved WazirX’s restructuring plan, allowing repayments to users and potentially resuming exchange operations.
Founder Nischal Shetty took to X to express gratitude:
“Thanks to all who stood by us during the rough patch. The Singapore High Court has approved the scheme. This wouldn’t have happened without your support and love.”
After creditors supported a new proposal, court approval came following an earlier proposal being placed on hold over concerns about token-based compensation under Singapore law.
The WazirX Hack and What Followed
In July 2024, WazirX experienced a hack where $234 million was stolen from its Safe Multisig wallet. According to cybersecurity analysts, the hack is attributed to North Korea and possibly the Lazarus Group, known for sophisticated cryptocurrency thefts.
Attempts to approve repayment plans were delayed due to regulatory ambiguity regarding recovery tokens. Without court approval, earlier proposals could have extended repayments until 2030, according to WazirX communications.
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Timeline for User Repayments
WazirX users remain hopeful for fund recovery after the court approval.
According to Shetty, exchange operations and repayment distributions could begin within 10 days after the scheme starts on August 20. However, George Gwee, director at restructuring firm Kroll, noted that full recovery may take two to three months.
Currently, WazirX has not issued an official timetable for distribution. Attempts to clarify timelines with the exchange were unanswered.
Implications and Recovery Roadmap
The WazirX exchange received court approval after over a year of legal proceedings aimed at restoring the trust of 150,000+ impacted users. As recovery unfolds, WazirX will face operational challenges and test token-based repayment mechanisms in a regulated environment.
Singapore’s reputation as a crypto dispute resolution hub is likely to strengthen, highlighting the ongoing challenges faced by exchanges navigating between regulatory and operational environments.
