The WazirX Creditor Approval and Implications for Crypto Asset Recovery and Market Confidence

The WazirX restructuring saga, triggered by a $234 million hack in July 2024, has become a pivotal case study for crypto asset recovery and regulatory frameworks. By October 2025, the Singapore High Court had sanctioned a revised restructuring plan, securing 95.7% creditor approval by number and 94.6% by value, according to Decrypt. This outcome not only averted a potential liquidation process that could have delayed recoveries until 2030 but also introduced a novel recovery token (RT) system, allowing users to reclaim 75–80% of their balances, as reported by Mudrex. For investors, this case underscores both the risks and opportunities inherent in regulated crypto platforms post-crisis.

Creditor Approval: A Blueprint for Crypto Insolvency?

WazirX's restructuring plan, initially rejected in June 2025 due to regulatory concerns, was revised to align with Singapore's evolving digital asset laws, according to the WazirX blog. The court-approved scheme now includes a phased repayment model, with 52% of recoveries in liquid crypto and 23–28% in RTs, which represent future profit-sharing rights, as noted by CryptoNews. This hybrid approach balances immediate liquidity with long-term compensation, a departure from traditional insolvency models like FTX's liquidation, as discussed in Bar & Bench.

The success of this plan hinges on two factors: creditor participation and regulatory alignment. Over 95% of creditors re-voted in favor of the revised terms, reflecting confidence in the platform's ability to rebuild trust, according to Fortune India. However, challenges remain, including incomplete asset recovery (only $3 million of $234 million stolen has been recovered) and ongoing legal disputes with partners like Binance, according to CoinLaw. These risks highlight the importance of robust compliance frameworks, as WazirX's parent entity, Zettai Pte Ltd, was found to have operated without a required license under Singapore's Payment Services Act, as reported by CryptoTimes.

Regulatory Responses: A New Era for Crypto Oversight

The WazirX case has accelerated global regulatory scrutiny of crypto custodians. Singapore's use of a court-supervised Scheme of Arrangement under the Insolvency, Restructuring and Dissolution Act of 2018 has set a precedent for resolving large-scale crypto insolvencies, noted by the New Indian Express. Meanwhile, the U.S. and EU have introduced complementary frameworks: the GENIUS Act (2025) for stablecoins and MiCAR (2024–2025) for broader crypto assets, according to CryptoNewer. These regulations emphasize transparency, consumer protection, and institutional-grade compliance-factors that now define "regulated" crypto platforms.

For investors, the WazirX restructuring demonstrates that regulatory alignment is non-negotiable. Platforms lacking clear licensing or custodial safeguards face existential risks, as reported by TechStory. Conversely, exchanges that integrate profit-sharing models (like WazirX's 20–30% revenue allocation to creditors) and decentralized infrastructure (e.g., multi-signature wallets, cold storage) are better positioned to attract institutional capital, as Mudrex notes.

Market Confidence: A Mixed Bag

Post-restructuring, market confidence in WazirX has shown a nuanced trajectory. On one hand, the relaunch has spurred optimism, with the platform planning a decentralized exchange (DEX) to reduce custodial risks, according to FinanceFeeds. On the other, the broader crypto sector remains cautious. Q3 2025 data reveals that while Ethereum and Solana outperformed, Bitcoin's market share dipped to 42%, according to CryptoRank.

Investors must weigh these dynamics. The WazirX case illustrates that transparency and tokenized recovery mechanisms can restore trust, but they also introduce new risks-such as RT volatility and liquidity constraints, warns CryptoRobotics. For regulated platforms, the key is to balance innovation (e.g., DEX integration) with proven compliance measures.

Strategic Investment Opportunities

The WazirX restructuring highlights three strategic opportunities for investors:
1. Regulated Platforms with Proven Compliance: Exchanges adhering to frameworks like MiCAR or the GENIUS Act are better insulated from regulatory shocks.
2. Tokenized Recovery Models: RTs and similar instruments offer liquidity and profit-sharing potential, though their value depends on platform performance.
3. Decentralized Infrastructure: DEXs and multi-signature wallets are gaining traction as investors prioritize self-custody solutions, according to Crystal Intelligence.

However, these opportunities come with caveats. The WazirX case underscores the need for diversification and due diligence. For instance, while RTs represent a novel approach to asset recovery, their tradability on secondary markets remains untested (see Mudrex). Similarly, DEXs, though secure, face challenges in liquidity and user adoption.

Conclusion

WazirX's restructuring is a landmark event in crypto history, offering a blueprint for asset recovery and regulatory alignment. For investors, the case reinforces the importance of regulatory compliance, transparency, and innovative compensation models. While the road to full recovery is fraught with challenges, the lessons from WazirX's relaunch provide a roadmap for navigating the evolving crypto landscape. As global regulators continue to tighten oversight, platforms that adapt-like WazirX's planned DEX and profit-sharing framework-will likely dominate the next phase of the market.