DBT Bureau
Pune, 29 Jan 2025
In a significant development, the Singapore High Court has given the decision in favour of Zettai Pte Ltd, allowing the company to convene a scheme meeting with the users of the cryptocurrency exchange, WazirX. This decision is a significant step in Zettai’s efforts to distribute assets associated with WazirX to users, and to revive operations of the platform. The Court granted a 16-week moratorium to Zettai, which provides the necessary time and legal protection to carry out the restructuring process. In addition, the Court also granted permission to Zettai to vary the scheme meeting process, which is intended to streamline the process and facilitate the participation of more users in the scheme meeting.
The Court found that there was no abuse of process and also observed that there was no proper or sufficient evidence presented before the Court of wrongdoing or misconduct, contrary to suggestions made by certain users of the platform that Zettai had orchestrated the cyberattack. This observation comes at a crucial time, following a joint statement from the governments of the United States, Japan, and South Korea identifying the North Korean Lazarus group as responsible for the cyberattack. The Court also took note that whilst there may be a number of creditors who have voiced objections to Zettai’s application, there is also the possibility of a silent majority of users who support the application but have decided to be passive in the process.
Zettai wishes to take this opportunity to reiterate its commitment to addressing user concerns and implementing a comprehensive restructuring plan to facilitate recovery for users of the platform in a structured manner.
Key Components of the Approved Scheme
- Debt Restructuring Framework: The Scheme establishes a structured approach for reorganizing the liabilities associated with WazirX to optimize returns for all platform users.
- Token Distribution: Rebalanced platform liquid assets will be distributed in tokens to scheme creditors within 10 business days of the effective scheme date.
- Recovery Token Implementation: The Scheme includes the issuance of recovery tokens (RTs) and distribution of recoveries through RT purchase mechanisms.
- Platform Reactivation: Plans include the strategic reactivation of the WazirX platform, featuring new capabilities and the launch of a decentralized exchange (DEX).
- Profit-Sharing Structure: Available net profits generated during a 36-month period would be used to fund RT purchases.
“I thank the court for granting us leave to convene the scheme meeting and for acknowledging our efforts. We are leaving no stone unturned to facilitate recovery to the users at the earliest and appeal to the users to vote in favour of the scheme.” said Nischal Shetty, Founder of WazirX.
Next Steps
The creditors’ meeting is scheduled to be held online, with voting on the proposed Scheme of Arrangement to take place thereafter electronically. Zettai will notify creditors of details of this process shortly.
Zettai remains committed to maintaining transparency and fairness throughout this process. Zettai believes that the proposed Scheme represents the most efficient and equitable path toward resolution for all platform users, and strongly encourages platform users to support the Scheme, as it offers the potential for enhanced recoveries compared to alternative scenarios.
