WazirX To Fulfill These Conditions Amid 4-Month Moratorium

A Singapore High Court has outlined several conditions that the WazirX exchange must fulfill following the grant of a four-month moratorium. The grant of the moratorium application paves the way for a restructuring plan from the exchange to repay customers.  About 45% of users’ funds were stolen following the $230 million hack on the exchange. Onchain data shows that the hacker is almost done laundering the funds.

WazirX To Fulfill These Conditions

The court ordered the Indian crypto exchange to publicize its wallet addresses via a court affidavit within three weeks of the moratorium order. The affidavit must provide details of the hacked wallets and what is left in the exchange’s remaining wallets. The platform also has three weeks to respond to user’s queries in the court chat room.

Furthermore, within six weeks, the crypto exchange must disclose its latest management accounts and balance sheet via an affidavit. Independent parties will oversee the voting process on future restructuring schemes, and a creditor committee will be formed as part of the conditions.

Meanwhile, the crypto exchange must file an extension notice three weeks before the moratorium order deadline if it needs more time to complete the restructuring process.

This moratorium order places a stay on any repayment the exchange was meant to make to its stakeholders and provides temporary relief for the exchange. WazirX had on August 27 filed a six-month Moratorium application with the High Court of Singapore under the Insolvency, Restructuring and Dissolution Act. However, the court eventually granted only four months.

“We are thankful for the court’s decision, which allows us to focus on our path to resolution, recovery, and restructuring,” WazirX’s founder, Nischal Shetty, said in a press release. “Our immediate filing for the moratorium was a decisive step taken to ensure the fastest, fairest, creditor-approved, legally binding path to resolution where creditors have a token choice and potential upside in a bull run,” He added.

The WazirX occurred on July 18, with the hacker stealing around $230 million worth of crypto. Hacks on crypto exchanges continue to be a problem. The BingX hack recently occurred, with $43 million worth of USDT and USDC stolen in the process.

How The Scheme Of Arrangement Will Work

The arrangement will involve WazirX developing a binding agreement with its creditors to pay back their money within an agreed timeline. The exchange revealed that they were already working diligently with their advisors and stakeholders to develop a comprehensive plan that addresses the needs of all parties involved.

The crypto exchange announced that they would rank affected users equally with each other as unsecured creditors. These users will receive a share of the tokens the exchange currently holds in its reserves. WazirX added that they will distribute these funds proportionally to the share of all users’ unsecured claims for their account balances.

Furthermore, as part of the restructuring plan, the Indian crypto exchange will devise mechanisms to increase token recoveries. They will also implement revenue-generating products and profit-sharing mechanisms and consider potential opportunities for third-party partnerships. These plans will benefit users and provide a way to make them whole again.

SpotOnChain data shows that the WazirX hacker is almost done laundering the funds that they stole from the exchange. The hacker has only about $3.37 million worth of crypto in the wallet to which they transferred the stolen funds.