Indian cryptocurrency exchange WazirX has received a boost in its efforts to recover from a $235 million cyberattack. On January 23, the Singapore High Court approved the exchange’s restructuring plan, enabling the repayment of customer funds stolen in the July 2024 breach. The attack, attributed to North Korea’s notorious Lazarus Group, had left users and the platform grappling with significant losses.
The restructuring plan, filed by WazirX’s parent company Zettai under Singapore’s Companies Act 1967, aims to prioritize creditor recovery while avoiding liquidation. The exchange estimates that affected users could recover between 75% and 80% of their account balances through token-based distributions. Notably, the court found no evidence of misconduct or negligence on WazirX’s part in the cyberattack, a conclusion aligned with a joint statement from the governments of the United States, Japan, and South Korea, which linked the breach to the Lazarus Group.
WazirX is set to conduct a user voting process over the next three months to secure approval for the restructuring scheme. Should the majority of users vote in favor, the plan will be implemented, with net liquid assets distributed to users within 10 business days. The distributions will factor in user claims, including potential gains from market recoveries.
The exchange has already frozen $3 million in USDt linked to the stolen funds, while efforts to recover additional assets in collaboration with international authorities are ongoing. To ensure transparency and fairness, an independent third-party audit will also oversee the implementation of the recovery process.
Under the court-supervised Singapore Scheme of Arrangement, WazirX plans to introduce “recovery tokens” as part of its repayment strategy. These tokens will represent outstanding claims and provide users with a stake in the platform’s future profits and recovered assets. The exchange has also committed to a three-year buyback program for the tokens, financed by profits and recoveries from stolen or illiquid assets.
Looking ahead, WazirX aims to bolster its financial position by launching a decentralized exchange, with revenues contributing to ongoing user reimbursements. The court emphasized that restructuring, rather than liquidation, offered the best path forward for both the exchange and its users, ensuring a more favorable outcome in the wake of the devastating cyberattack.
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