WazirX Presses Creditors to Approve Restructuring or Risk Delays

Indian crypto exchange WazirX has urged its creditors to approve a proposed restructuring plan. The move comes as the exchange faces increasing pressure to resolve its financial challenges or risk significant delays in the platform’s operations and recovery.

The crypto exchange shared an image illustrating two potential scenarios for creditors impacted by the hack. If the restructuring proposal receives approval, the company stated it could initiate the process as soon as April 2025, relaunch its platform, and commence the initial phase of repayments.

WazirX, a victim of a hack of over $230 million sometime last year, noted that if creditors do not approve its proposed restructuring plan, it could be delayed until 2030.

WazirX Plans More Strategic Ways

Additionally, the company announced plans to launch a decentralized exchange and compensate creditors by sharing profits and recovering stolen assets. However, if the restructuring proposal is rejected, WazirX warned that creditors could face uncertain and possibly prolonged timelines. The exchange added that creditors would have to wait for the resolution of the ownership dispute before receiving any repayments.

Nonetheless, the proposed plan involves significantly reducing outstanding liabilities, renegotiating certain contractual obligations, and potentially obtaining capital injections from strategic investors. While the details remain confidential, industry insiders believe that the crypto exchange aims to secure a more manageable debt profile that aligns with its current market conditions.

In line with the restructuring plans, WazirX cautioned users that if liquidation takes place before the ownership dispute is settled, asset repayment could be postponed and made in fiat at a reduced value due to liquidation expenses.

The company also stated that users may miss out on near-term bull runs due to uncertain and prolonged timelines.

Court Approves WazirX Restructuring Plan

Following the exchange’s plan, on January 23, the High Court of Singapore approved the firm’s restructuring plan. The court favored restructuring over liquidation, emphasizing that swift distributions would yield the best results for users.

According to the plan, the company anticipates that users could recover as much as 80% of their balances. The exchange intends to reimburse affected users by issuing recovery tokens, which represent claims and allow creditors to benefit from recovered assets and future platform profits.

WazirX noted that a voting process will be carried out, which is expected to be completed within three months. If the majority approves, the company will allocate net liquid assets to users according to their claims within 10 days.