Singapore Court Approves WazirX Plan, Setting Crypto Insolvency Precedent

Singapore's High Court has granted final approval to WazirX's debt restructuring plan, marking a pivotal step in the Indian cryptocurrency exchange's recovery from a $234 million hack in July 2024. The decision, announced on October 13, 2025, clears the way for user repayments and operational resumption after more than a year of legal battlesWazirX Secures Singapore Court Approval to Repay Users After …^[1]. The court's endorsement followed overwhelming creditor support for the revised proposal, with over 95% of participating creditors backing the plan in AugustWazirX restructuring gets Singapore court nod, user fund recovery revealed^[2].

The restructuring plan, supervised by WazirX's Singapore-based parent company Zettai Pte Ltd, aims to return up to 85% of users' account balances, based on valuations from the date of the hackWazirX Wins Court Nod in Singapore for Debt Restructuring …^[3]. Under the scheme, users will receive a combination of liquid assets and recovery tokens tied to the exchange's future earnings. The first round of token distributions is expected within 10 business days of the court's approvalSingapore Court Approves WazirX Plan: Users to Recover 55%^[4]. However, George Gwee of restructuring firm Kroll, which is advising WazirX, cautioned that full repayments could take two to three months due to logistical complexitiesWazirX Secures Singapore Court Approval to Repay Users After …^[1].

The hack, attributed to North Korea's Lazarus group, exploited vulnerabilities in a Safe Multisig wallet, forcing WazirX to halt withdrawals and triggering a cascading legal and financial crisisWazirX Wins Singapore Court Nod for Restructuring Scheme: CEO^[6]. The exchange's initial restructuring proposal was rejected in June 2025 by the Singapore High Court over regulatory concerns regarding token distributionsSingapore Court Approves WazirX Restructuring Plan^[7]. The revised plan, which routes repayments through WazirX's Indian entity Zanmai Labs, addressed these issues and secured even stronger creditor support in a second voteWazirX Wins Court Nod in Singapore for Debt Restructuring …^[3].

WazirX founder Nischal Shetty hailed the court's decision as a "milestone" in the platform's recovery, emphasizing the importance of user support in navigating the legal hurdlesWazirX Secures Singapore Court Approval to Repay Users After …^[1]. The approval also shields the exchange from liquidation, which could have delayed repayments until 2030. The court's decision aligns with Singapore's broader efforts to establish a clear legal framework for crypto insolvency, offering a potential precedent for future casesWazirX Users Set for Partial Refunds as Singapore Court Approves …^[8].

While the restructuring plan provides a path to recovery, challenges remain. Only $3 million of the stolen assets have been recovered, and the exchange's operational relaunch hinges on rebuilding user trust. Critics argue that repayments pegged to 2024 prices leave users exposed to missed gains from the subsequent crypto market rallyWazirX Relaunch 2025: Recovery Plan, Token …^[9]. Additionally, the plan's reliance on recovery tokens introduces liquidity risks, as their value depends on WazirX's future performance.

With the court's green light, WazirX now faces the dual task of executing its repayment strategy and relaunching its platform. The exchange has also announced plans to launch a decentralized exchange (DEX) by Q3 2025, aiming to reduce custodial risks. For now, users await clarity on the exact timeline for fund distributions, with some optimistic about a swift resolution and others bracing for delaysWazirX Secures Singapore Court Approval to Repay Users After …^[1].