WazirX Wins 93.1% Creditor Approval Amid Legal Scrutiny in India

WazirX’s Recovery Plan Gains Strong Support Amid Legal Challenges

WazirX, a leading Indian cryptocurrency exchange, has secured overwhelming support for its recovery plan following a cyberattack last year. Despite this, the approach to restructuring user assets worth ₹4,400 crore has come under scrutiny from the Delhi High Court, raising concerns about user consent and data privacy.

• 93.1% of creditors approve WazirX’s restructuring plan.
• Delhi High Court questions the restructuring of ₹4,400 crore in user assets.
• Petitioners challenge forced legal waivers and data privacy issues.

Founded in 2018, WazirX quickly became one of India’s prominent crypto exchanges, known for its user-friendly interface and wide range of trading options. However, on July 18, 2024, the exchange fell victim to a sophisticated cyberattack, compromising approximately 45% of its crypto assets. This incident not only shook WazirX’s foundations but also highlighted the critical need for robust security measures in the crypto industry.

In a bold move to recover from the devastating cyberattack, WazirX announced on April 7, 2025, that its debt restructuring plan had been approved by a resounding 93.1% of its creditors. Over 1.4 lakh creditors participated in the vote, with 1.3 lakh casting their ballots in favor. This plan, proposed by WazirX’s parent company, Zettai Pte Ltd, aims to distribute recovered funds within 10 business days of receiving the final nod from the Singapore High Court.

But here’s where it gets tricky. The restructuring isn’t just about recovering funds; it’s about navigating a legal minefield. The Delhi High Court threw a curveball on March 28, 2025, issuing a notice in response to a petition challenging the restructuring of user assets worth ₹4,400 crore. Petitioners Sudhir Verma and Kunal Dhariwal argue that the restructuring affects even those assets not touched by the cyberattack, forcing users to give up their right to sue and potentially violating Indian laws. To add insult to injury, the restructuring involves sharing over 4 lakh Indian users’ personal and financial data with foreign companies, raising significant data privacy concerns.

The petitioners are pushing for a Special Investigation Team (SIT) to delve into the cyberattack and ensure WazirX complies with Indian laws. This case could set a precedent for how cryptocurrency exchanges handle user assets and navigate legal jurisdictions, impacting future restructuring plans and user rights protection across the industry. It’s a high-stakes game of chess, and every move counts.

Despite the legal turbulence, WazirX’s founder, Nischal Shetty, remains optimistic, stating,

“We are grateful for the strong vote of confidence. This consistent support across our entire base demonstrates shared belief in our restructuring approach and recovery plan.”

But let’s not forget the elephant in the room: the restructuring plan includes ₹259 crore in legal and administrative costs. That’s a hefty price tag, and it adds another layer of complexity to the situation. As the crypto community watches closely, the next hearing in the Delhi High Court is scheduled for April 29, 2025. The outcome could have far-reaching implications for the cryptocurrency landscape in India and beyond, particularly in how exchanges manage user funds and navigate international legal frameworks.

What does this mean for you as a crypto enthusiast? Well, let’s take a closer look at the broader implications. The case underscores the delicate balance between innovation and regulation in the crypto space. It’s a reminder that while the potential of blockchain and cryptocurrencies is immense, the challenges are equally significant. The need for robust security measures and clear legal guidelines to protect users while fostering the growth of decentralized technologies has never been more apparent.

Let’s talk about the elephant in the room: Bitcoin. How might this case affect Bitcoin adoption in India? The answer lies in user trust. If exchanges like WazirX falter, it could shake the confidence of users, potentially slowing down the adoption of Bitcoin and other cryptocurrencies. But on the flip side, this case could also drive the industry to become more transparent and secure, ultimately benefiting Bitcoin’s long-term prospects.

And what about other cryptocurrencies and blockchain projects? How might they handle similar situations? Perhaps they would take a different approach, focusing on decentralization and user autonomy to avoid the pitfalls WazirX is facing. It’s a reminder that while Bitcoin is the king of the hill, other players in the crypto space have their own unique roles to play.

Now, let’s get practical. What can you do to protect your assets from similar cyberattacks? First, use strong, unique passwords for your accounts. Second, enable two-factor authentication wherever possible. And third, keep a close eye on your accounts for any suspicious activity. Remember, in the world of crypto, security is everyone’s responsibility.

As we wrap up, it’s clear that the WazirX case is more than just a legal battle; it’s a litmus test for the future of cryptocurrency in India. It highlights the tension between decentralization and regulation, between user rights and platform responsibilities. And as we navigate this complex landscape, one thing is certain: the journey towards a decentralized financial future is far from over.

Key Questions and Takeaways

What is the current status of WazirX’s debt restructuring plan?
The plan has been approved by 93.1% of creditors and is awaiting final approval from the Singapore High Court.

What concerns have been raised about WazirX’s restructuring of user assets?
Concerns include lack of user consent, restructuring of unaffected assets, forcing users to drop legal cases, potential violation of Indian laws, and data privacy issues.

How has the Delhi High Court responded to the petition against WazirX?
The Delhi High Court issued a notice on March 28, 2025, and has given the government two weeks to respond.

What is the role of the Special Investigation Team (SIT) in this context?
The petitioners have requested an SIT to investigate the cyberattack and ensure compliance with Indian laws regarding the restructuring of WazirX’s assets.

What are the potential implications for cryptocurrency exchanges in India following this case?
This case could set a precedent for how cryptocurrency exchanges handle user assets and legal jurisdictions, impacting future restructuring plans and user rights protection.

How might this case affect Bitcoin adoption in India?
The case could influence user trust in cryptocurrency exchanges, which in turn could impact Bitcoin adoption rates.

What can users do to protect their assets from similar cyberattacks?
Users should use strong, unique passwords, enable two-factor authentication, and regularly monitor their accounts for suspicious activity.