ETtech Explainer: Why WazirX's recovery plan hit a legal roadblock

Indian cryptocurrency exchange WazirX took a major hit on Wednesday after the Singapore High Court rejected a restructuring plan submitted by its parent company, Zettai Pte Ltd, in November 2024. The proposal came just months after the platform suffered a massive $235 million cybertheft last July.

Court’s verdict

Sources aware of the matter told ET that the Singapore High Court noted that Zettai Pte Ltd, the operating entity behind WazirX, was not registered in India. Based on this, the court ruled that the restructuring scheme would not be valid in the country.

ET reviewed the documents Zettai has filed in response to queries from the Singapore court. WazirX confirmed the development and said that it will appeal against the court's decision.

"Our primary focus remains to begin distribution as soon as possible… we are currently evaluating all available legal options in consultation with our legal and advisory teams, and will be appealing against the decision of the Singapore High Court," WazirX said in a statement.

Cyber theft

Last year, ET reported that WazirX was hit by one of the biggest cyberattacks on an Indian crypto exchange. Hackers made off with more than $230 million worth of investor funds, nearly half of the platform's estimated reserves.

Blockchain experts indicated possible involvement of the cybercriminal group Lazarus in the attack.

Lazarus, allegedly backed by the North Korean government, has previously been linked with some of the largest crypto exchange hacks globally. The group is known for leaving victims unable to recover stolen funds due to a lack of negotiation or communication.

FBI outreach

The US Federal Bureau of Investigation (FBI) reached out to WazirX to study the nature of the cyberattack allegedly involving North Korean cybercriminals and to support the investigation, ET reported on July 29, last year.

Upcoming crypto policy framework

ET reported on May 30 that India is likely to release a discussion paper next month, regarding possible policy frameworks for cryptocurrency assets. The move comes amid growing acceptance of digital currencies, after US president Donald Trump’s support, according to people familiar with the matter.