Zettai Pte Ltd, the Singapore-based majority stakeholder in WazirX, has sought a moratorium in order to restructure its finances. A moratorium can be explained as a legal authorisation to debtors to postpone payments. Zettai’s application, filed in a Singapore court, is part of the firm’s attempt to buy some time for WazirX to restructure its finances following the recent hack attack on one of the crypto exchange’s multi-sig wallets, that led to the theft of over $230 million (roughly Rs. 1,931 crore).
WazirX estimates that Zettai may take at least six months to formulate a scheme, which if approved by the creditors and sanctioned by the Singapore Court, “would be legally binding on all relevant parties, including Zettai.” The platform needs this time to finalise the terms and conditions of this financial restructuring scheme.
In an official statement shared on Wednesday, the beleaguered Indian exchange said that this moratorium provides a breathing space while Zettai progresses with a restructuring plan to readjust users’ cryptocurrency balances and facilitate the recovery of funds they might have lost in the hack.
“An automatic moratorium of 30 days arises from the filing of the application (i.e., 27 August 2024), and the Singapore Court will determine whether to grant the moratorium sought at a hearing of the application (and the duration of the moratorium, if so granted),” the company said. “If restructuring is not favoured, resolving crypto balances through alternative routes could involve undefined risks and timelines.”
Nischal Shetty, the co-founder of WazirX, is the director of Zettai. In an affidavit shared with customers and reviewed by Gadgets360, Shetty attempts to assure WazirX users that the Singapore-based entity will not wind up its operations in the midst of this ongoing process.
As per the affidavit, Zettai was incorporated in Singapore in January, 2019 under the laws of Singapore. On September 2, the WazirX team and the company’s advisors will be participating in a townhall session to explain the details of the latest development. The exchange claims that the scheme formulated by Zettai in the coming days will ensure an equitable, and creditor-approved approach to the distribution of token assets.
Meanwhile, WazirX opened INR withdrawals for distressed users earlier this week. For now, WazirX customers will only be able to access and withdraw 66 percent of their funds, while the remaining 34 percent will remain frozen due to ongoing investigations into the incident.