Fast Relief for Creditors
The proposed Scheme, filed in the Court under mainly the Companies Act 1967 on 6 December 2024, prioritizes creditors by outlining a structured roadmap for recovery. If the Court grants leave for Zettai to convene a meeting of its Scheme Creditors, Zettai will be able to put the proposed Scheme before its Scheme Creditors for a vote. A Scheme will only become effective if it is approved by the requisite majority of the Scheme Creditors and is sanctioned by the Singapore Court.
Zettai is able to arrive at this stage, confident enough to propose a Scheme as the Singapore High Court had on 26 September 2024 granted Zettai a four-month moratorium to focus on resolution, recovery, and restructuring, representing a proactive response from the company to stabilize operations and enable fund distribution after the theft of over US$230 million (INR 1900 crore) on 18 July 2024.
The proposed Scheme, if approved, includes initial distributions within 10 Business Days (as defined in the proposed Scheme) after the Scheme has become effective. Under the Scheme the net available liquid funds (after accounting for, among others, professional fees and other operational costs) which currently represent over 100% of the USD value of liabilities as on 18th July 2024, will be disbursed to Scheme Creditors in the proportionate token balances held in their portfolio, ensuring they benefit from the ongoing crypto bull run. Scheme Creditors will additionally receive Recovery Tokens for additional recoveries under the Scheme. With the ongoing crypto surge, Zettai believes that Scheme Creditors are well-positioned to not only recover their capital but also gain from the potential upside in token distributions.
Data Snapshot:
- Total Claims: 546.47M USDT (as of 18 July 2024, 1:00 PM IST)
- Liquid Assets: 566,385,206M USDT (as of 5 December 2024, 10:00 AM IST)
The value of current liquid assets exceed total claims in USD equivalent as at 18 July 2024, offering Scheme Creditors a promising opportunity for full recovery of their USD equivalent claims as at 18 July 2024 and potential additional returns.
Efficient Recovery Roadmap
The Scheme offers a structured, transparent, and time-bound approach to fund recovery, ensuring Scheme Creditors benefit from both immediate distributions and long-term recoveries. The Scheme follows a structured timeline of events. Scheme Creditors are given an opportunity to vote on the proposed Scheme on a third-party independent platform, and the results will be verified by a reputable third-party scrutineer. The Scheme needs to be approved by a majority vote in numbers representing at least 75% of Scheme Creditors by value of Scheme Creditors present and voting. After the Scheme is approved by the requisite majority of creditors, Zettai will then make an application to the Court for sanction of the Scheme.
The approval from the Scheme Creditors and a sanction from the Court will pave the way for the restructuring to take effect, ensuring creditors receive their distributions seamlessly and within a defined timeline. If the restructuring is not approved, Scheme Creditors will most likely have to wait for the ownership dispute in relation to the WazirX Platform to be resolved – which will have unclear and potentially extended timelines.
“The restructuring scheme reflects our unwavering commitment to creditors during this challenging time,” said Nischal Shetty, Founder of WazirX. “By voting 'yes' in favour of the Scheme of Arrangement, creditors will empower us to prioritize timely distributions and create an operational framework that ensures long-term stability.” He emphasized that while global exchanges have taken years for similar recoveries, WazirX aims to resolve this process within months – potentially making it one of the fastest recoveries in crypto history.
Key Highlights of the Scheme:
1. Swift Initial Distributions: Creditors will receive an initial distribution of available liquid assets within 10 Business Days of the Scheme becoming effective. This ensures Scheme Creditors get a portion of their validated claims quickly.
2. Recovery Tokens: Scheme Creditors will further receive Recovery Tokens. These will be redeemed systematically with the Platform’s recovery efforts.
3. Aggressive Asset Recovery Efforts: Zettai is actively collaborating with forensic specialists and authorities to retrieve stolen assets. Recovered funds will be used to redeem Recovery Tokens, providing further recovery.
4. Transparency in Process: Zettai commits to regular 4-monthly reporting on asset recovery efforts and financial health, ensuring stakeholders remain fully informed throughout the process.
5. New Revenue Streams: Zettai plans to launch a decentralized exchange (DEX), with any profits from the DEX contributing to the recovery pool.
For more information on the scheme or details on the voting process, please visit https://wazirx.com/