WazirX, a prominent Indian cryptocurrency exchange, is on the verge of a potential relaunch after a devastating hack that stole approximately $234 million in July 2024. The company is awaiting a crucial decision from Singapore’s High Court on May 13, 2025, regarding its restructuring and user compensation plan. If approved, WazirX could resume operations and start compensating affected users within ten business days, marking a significant step towards recovery for the platform and its users.
The hack, attributed to North Korean cybercriminals, specifically the Lazarus Group, targeted WazirX’s Safe Multisig wallet, leading to a suspension of both cryptocurrency and fiat withdrawals. In response to the incident, WazirX’s parent company, Zettai PTE Ltd, has been working on a comprehensive restructuring plan aimed at compensating users for their losses. In an update shared on April 21, 2025, WazirX confirmed that Zettai had completed all necessary steps leading up to the court’s sanction hearing.
“This hearing is essential for the Scheme to become legally effective,” WazirX stated, emphasizing its commitment to adhering to legal procedures despite the inherent delays of court processes. The proposed recovery plan involves issuing recovery tokens that will be gradually repurchased using the exchange’s future profits. This plan aims to return between 75% and 80% of users’ lost balances, a significant relief for those affected by the hack.
Earlier in April, over 90% of voting creditors approved the restructuring proposal, which was critical in avoiding a scenario where repayments could have been delayed until 2030. The overwhelming support from creditors reflects a collective desire to see the exchange recover and resume operations. WazirX has reiterated its goal to restart services within the April-May 2025 timeframe, contingent upon the court’s approval.
However, not all news has been positive for WazirX. On April 16, 2025, India’s Supreme Court dismissed a petition filed by 54 victims of the hack who sought legal action against WazirX, its co-founder Nischal Shetty, Binance, and custody provider Liminal. The court ruled that the matter fell outside its jurisdiction, advising petitioners to approach regulatory authorities instead.
The Supreme Court’s decision has reignited criticism of India's approach to cryptocurrency regulation. Critics argue that while the government imposes a 30% tax on cryptocurrency profits, it offers little legal protection to investors. The court's dismissal of the victims’ claims highlights significant gaps in the regulatory framework governing cryptocurrencies in India.
As WazirX prepares for its potential relaunch, the exchange faces ongoing legal challenges and scrutiny over its security practices. Victims of the hack accused the exchange of negligence, raising concerns about the adequacy of its security measures. Despite these challenges, the exchange remains focused on its recovery efforts, aiming to rebuild trust among its user base.
The upcoming court decision is pivotal not only for WazirX but also for the broader cryptocurrency landscape in India. The outcome could set a precedent for how similar cases are handled in the future, particularly as the country grapples with the complexities of cryptocurrency regulation.
As the May 13 hearing approaches, WazirX is urging its users to remain patient. “We understand the eagerness around the platform restart and truly appreciate your continued patience,” the company stated. The exchange has communicated that the first distribution and restart would occur within the April-May 2025 window, depending on the court's ruling.
In summary, WazirX is poised for a potential comeback as it awaits a critical court decision regarding its restructuring plan. With the overwhelming support of its creditors and a clear plan to compensate users, the exchange is hopeful for a positive outcome. However, the challenges posed by legal hurdles and regulatory scrutiny remain, making the future uncertain for both WazirX and its users. As the cryptocurrency sector continues to evolve, the resolution of WazirX’s situation will be closely watched by investors and regulators alike.
