Background of the WazirX Hack and Insolvency Proceedings
In July 2024, WazirX, a leading cryptocurrency exchange, suffered a security breach resulting in the theft of approximately $235 million in crypto assets. The hack triggered suspension of services and initiated complex insolvency proceedings under Singapore’s creditors’ framework. Over the subsequent months, WazirX engaged with stakeholders, legal advisors and affected users to develop a restructuring plan aimed at maximizing recoveries and providing an equitable distribution of remaining assets.
High Court Approval Details
On October 13 2025 at 06:42:45 UTC, Singapore’s High Court formally sanctioned the WazirX scheme of arrangement proposed under Section 210 of the Singapore Companies Act. Key provisions of the approved scheme include:
- Recovery rate: Eligible creditors to receive up to 55% of their recognized claims.
- Scheme administrator: Appointed independent trustee responsible for asset collection, forensic accounting and distribution.
- Distribution timeline: Targeted completion within 12 months of approval, subject to asset realization variables.
- Governance oversight: Periodic reporting to the Court and creditor committee on progress and compliance.
Implications for Affected Users
Approximately 75 000 users registered claims related to assets lost in the hack, spanning Bitcoin, Ethereum and various altcoins. With the scheme now court-approved, these users can expect structured compensation, albeit partial. The 55% recovery rate reflects realistic valuation of recovered assets after legal costs, administrative expenses and creditor prioritizations. Users must submit final claim forms within 30 days to participate in distributions, subject to verification by the scheme administrator.
Industry Significance
The WazirX court approval sets a landmark precedent for judicial treatment of crypto exchange failures and asset recovery. It underscores the applicability of traditional insolvency mechanisms to digital asset platforms and may influence regulatory frameworks across jurisdictions. By establishing transparent guidelines for hack remediation and creditor protection, the ruling may enhance trust in the crypto ecosystem’s resilience and legal recourse options.
Regulatory and Compliance Outlook
Regulators in multiple jurisdictions are monitoring the WazirX proceedings as a case study in exchange solvency and consumer safeguards. The approval may prompt updates to licensing requirements, capital reserve mandates and mandatory insurance schemes for custodial platforms. Industry bodies are also expected to refine best practices for security audits, incident response protocols and user compensation frameworks based on insights from the WazirX experience.
Next Steps and Timeline
With court approval secured, the scheme administrator will commence asset recovery efforts, including legal claims against service providers and tracing of stolen funds. Distribution of initial tranches to verified creditors is anticipated within three to six months, contingent on asset liquidation timelines. Full scheme completion remains dependent on market conditions and ongoing judicial oversight.
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