Singapore Court Grants WazirX 4-Month Moratorium with Conditions

A court in Singapore has reportedly granted a four-month moratorium to WazirX, an Indian cryptocurrency exchange, following the company’s application for temporary relief.

This moratorium, however, is conditional, requiring complete transparency regarding the exchange’s wallet addresses and financial statements.

Conditions Set by the Court

This comes in the wake of a significant hack suffered by WazirX in July, which resulted in a loss of $234 million and impacted 45% of its customers’ assets. A statement reviewed by CoinDesk outlines that WazirX must submit a court affidavit disclosing all related wallet addresses.

Moreover, the exchange is obliged to provide its financial records within six weeks and address all user inquiries throughout this timeframe. The court also instructed that any voting on future actions be conducted on an independent platform to guarantee fairness.

The judge overseeing the case stated that the exchange demonstrated “good faith” in seeking this moratorium, recognizing its efforts to safeguard its creditors while facing financial challenges. She also recommended that the company consider making any non-crypto assets public.

Once one of the largest crypto exchanges in India by trading volume, WazirX initially sought a six-month moratorium from the Singapore High Court to facilitate its recovery strategies. Nischal Shetty, the founder of the company, defended the prompt filing for the moratorium.

“Our immediate filing for the moratorium was a crucial step to ensure the quickest, most equitable, creditor-approved, legally binding path to resolution, where creditors have a token choice and potential gains in a bullish market.”

Despite taking steps towards securing legal protection and pursuing a resolution, the prospects for reimbursement of customers in cryptocurrency appear bleak, according to legal advisors for the company.

Almost Finished Laundering Stolen Funds

In a related update, on-chain data reveals that the hacker behind the theft is nearing the completion of laundering the stolen funds. A wallet that originally held the stolen assets has decreased to $6 million in Ethereum (ETH), down from the initial $234 million.

Blockchain data from Arkham indicates that the hacker has utilized the privacy service Tornado Cash to transfer the funds, a platform that conceals wallet addresses and transaction details.

In August alone, over $50 million in tokens were processed through the service, with the hacker intensifying activity in September. The most recent significant transaction occurred on September 25, when 3,792 ETH, valued at around $10 million, was sent to a new wallet.