Singapore court grants moratorium after Rs 2,000-crore hack in July
The court’s conditions would significantly improve transparency towards stakeholders, giving them full visibility into the company’s moves as it steers through the recovery process.
A Singapore court has granted cryptocurrency exchange WazirX a four-month moratorium, allowing it to restructure liabilities in the aftermath of the cyber attack that wiped out nearly Rs 2,000 crore, accounting for 45 per cent of its users’ assets, according to a report in The Financial Express.
The exchange had suffered a massive cyber attack in July, which had resulted in WazirX losing nearly Rs 2,000 crore of customer funds, affecting around 4 million investors. According to reports, the hacker responsible has nearly completed laundering stolen funds using Tornado Cash to obscure transactions.
WazirX’s legal advisors said earlier this month that customers stand to lose 43 per cent of their funds, incurring a potential loss of around Rs 850 crore despite restructuring efforts. However, the court’s conditions would significantly improve transparency towards stakeholders, giving them full visibility into the company’s moves as it steers through the recovery process.
The court’s decision comes with certain conditions, aimed at maintaining transparency and restore confidence of investors and creditors. As part of the conditions, WazirX will have to make wallet addresses public via a court affidavit, respond to user queries raised in the courtroom, release financial information and ensure future voting for court applications is scrutinised by independent parties.
“We are thankful for the court’s decision, which allows us to focus on our path to resolution, recovery and restructuring,” said Nischal Shetty, founder of WazirX. “Our immediate filing for the moratorium was a decisive step to ensure the fastest, fairest, creditor-approved and legally-binding path to resolution, where creditors have a token choice and potential upside in a bull run.”
In August, WazirX had filed for a six-month moratorium. However, the Singapore court has granted four months to the company to find suitable white knights for capital support, implement revenue-generating products to share profit with users and track and recover stolen crypto assets, as part of its restructuring plan.
The court has acknowledged WazirX’s prompt response in filing for the moratorium, paving the way for the fastest, creditor-approved and legally-binding resolution to restore crypto balances, ensuring a fair and timely outcome for all stakeholders, the company said in a statement on Thursday.
“WazirX will continue to provide updates on our progress and further developments. We are steadfast in our commitment to resolve this matter efficiently and equitably. We are working diligently with our advisors and stakeholders to develop a comprehensive plan that addresses the needs of parties involved,” the statement said.
