WazirX has notified its creditors that if they do not vote in favour of the proposed restructuring plan, they will have to wait until 2030 to receive their payments. However, if they agree to the proposal, the creditors will receive their funds by April 2025.
It is ironic that the platform is coercing creditors to accept the proposed restructuring scheme, especially since the initial delayed response of the crypto exchange resulted in the loss.
A decision on the proposal is expected in the coming weeks, and if approved by more than 75% of creditors by value, the scheme will move forward.
The restructuring plan includes multiple components designed to recover lost assets. Key elements of the plan involve launching a decentralised exchange (DEX) and issuing recovery tokens, which will be tradable.
“Two paths, two very different outcomes. Here’s a breakdown of what happens if the Scheme is approved versus if it isn’t. Understand what to expect in both scenarios as we approach the voting process,” WazirX wrote on X.
Additionally, the exchange will periodically buy back recovery tokens using the platform’s profits, white knight collaborations and new revenue streams. Initial payouts of net liquid assets will be made within 10 business days after the scheme’s activation.
However, if the creditors reject the plan, WazirX faces the risk of liquidation under Singapore’s Companies Act. This could result in asset sales at lower values, potentially leading to smaller payouts for creditors and a prolonged recovery process. Also, in this situation, creditors will have to wait for the WazirX ownership dispute to resolve which can take a long time. Moreover, creditors are likely to miss bull runs.
WazirX, which was hacked in July 2024, saw over $230 million worth of user funds stolen.
Last month, Zettai, WazirX’s parent, called a creditors’ meet to recover stolen tokens. In December 2024, it was reported that the main suspect in the hack, M Hasan, fled to Bangladesh.
Meanwhile, WazirX hack victims sued the exchange at the National Consumer Dispute Redressal Commission (NCDRC) demanding full restoration of their digital assets.
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