Singapore court grants 4-month moratorium to WazirX after $230 mn hack

Thankful for the court's decision, it will allow us to focus on our path to resolution, recovery and restructuring, says Nischal Shetty, co-founder, WazirX

A Singapore court on Thursday granted a four-month moratorium to Indian cryptocurrency exchange WazirX, a period which the embattled firm will use to restructure its business without worrying about legal proceedings.

A moratorium offers applicant temporary relief from legal proceedings.

WazirX, India’s biggest crypto exchange, suffered a major hacking attack in July this year losing close to $230 million. Since then, it has been trying to deal with the crisis.

It had asked for a six-month moratorium, but the Singapore court gave it four months.

And with conditions.

The crypto exchange is required 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, co-founder, WazirX. 

WazirX, whose parent company Zettai is based in Singapore, applied for restructuring at a Singapore court on August 23.

Earlier this month, WazirX had said customers affected by the recent cyberattack will not be able to recover their full funds even as the firm looks to restructure.

At a virtual press conference earlier this month, the firm’s advisors had explained that the company might look to return 55-57 per cent of the capital.

The crypto exchange platform said it was restructuring and as part of that it was looking for a white knight to provide capital and pursue partnership and collaboration.  

This entails implementation of revenue-generating products and mechanisms to share profit with users, tracing and recovering stolen crypto assets, and/or allowing users who need liquidity urgently to withdraw crypto assets more quickly and exit restructuring. 

The company had blamed its third party wallet service provider Liminal Custody for the security breach. 

Liminal has denied the charge.