WazirX Hack Update: Recovery Efforts & Token Replacement Plans

The WazirX hack of July 2024 stands as one of the most consequential events in India’s crypto history, with over $230 million in user assets stolen and millions of investors left in limbo. Nearly a year later, the story continues to unfold, shaped by ambitious recovery efforts, a novel token replacement strategy, and ongoing legal and community scrutiny.

This blog offers a comprehensive, up-to-date look at WazirX’s recovery journey, the mechanics of its token replacement plan, and what users can expect in the months ahead.

The Hack and Its Immediate Aftermath

In mid-July 2024, WazirX lost approximately $234 million to a sophisticated cyberattack attributed to North Korean hackers. The breach targeted a Safe Multisig wallet, forcing the exchange to halt all withdrawals and trading, and triggering a crisis of confidence across India’s crypto landscape213.

Impact Snapshot

Metric	Value
Amount Stolen	$234 million+
Users Affected	Over 1.4 million
Platform Status	Trading & withdrawals frozen since July 2024

Recovery Efforts: Multi-Pronged Approach

WazirX’s response has been both aggressive and multi-faceted, focusing on asset tracing, legal action, and a sweeping restructuring plan.

1. Asset Tracing & Bounty Program

• Forensic Investigations: WazirX partnered with law enforcement and blockchain forensics firms, notably zeroShadow, to trace and freeze stolen assets. The first breakthrough came in January 2025, when approximately $3 million in USDT was successfully frozen.
• Bounty Program: WazirX launched an open bounty, offering up to $10,000 in USDT for actionable intelligence leading to the freezing or recovery of stolen funds. This incentivizes the global crypto community to assist in tracking the hackers’ movements.

2. Legal & Regulatory Action

• Singapore Court Proceedings: The recovery plan is being overseen by the Singapore High Court, with a pivotal sanction hearing scheduled for May 13, 2025. Approval is essential for the restructuring and user compensation plan to proceed.
• Scheme of Arrangement: WazirX’s parent company, Zettai Pte Ltd, has structured its recovery as a formal Scheme of Arrangement, ensuring creditor involvement and legal oversight.

3. Asset Rebalancing

• Portfolio Rebalancing: By January 2025, WazirX completed a comprehensive rebalancing of user portfolios, aligning available assets with user liabilities. This allows for a fair, proportional distribution of recovered assets.

Token Replacement: The Recovery Token (RT) Plan

Perhaps the most innovative aspect of WazirX’s recovery is its introduction of Recovery Tokens (RTs), designed to bridge the gap between immediate and long-term restitution for users.

WazirX Hack: How the Token Replacement Works

First Distribution

• Amount: Users will receive approximately 85% of their portfolio value (as of July 18, 2024) within 10 business days of court approval.
• Form: Distribution will be in the original crypto tokens where possible, or in USDT for illiquid assets.
• Timing: If the Singapore court approves the scheme in May 2025, distributions could begin before June 2025.

Recovery Tokens (RTs)

• Purpose: RTs represent each user’s claim to the remaining 15% of their lost assets.
• Issuance: RTs are distributed on a pro rata basis, proportional to each user’s approved claim.
• Buyback Mechanism: Every three months, WazirX will use profits and recovered assets to buy back RTs from holders. Buybacks will only occur if net recoveries exceed $10 million in a given period, with unspent amounts rolled over.
• Tradability: Subject to regulatory approval, RTs may be made tradable, allowing users to sell them on the open market.

WazirX Hack: User Recovery Timeline

Phase	Percentage of Claim	Form	Timeline	Notes
First Distribution	~85%	Crypto/USDT	May–June 2025 (est.)	After court approval
Recovery Tokens	~15%	RTs	Quarterly buybacks over 2–3 years	Value depends on profits & asset recovery

WazirX Hack: Why Recovery Tokens?

RTs provide a dynamic, transparent solution for ongoing recovery:

• Profit Sharing: Users benefit from WazirX’s future profits and any further asset recoveries, rather than being limited to a one-time payout.
• Market Flexibility: Tradability of RTs gives users the option to liquidate their claims early, if desired.
• Transparency: All buybacks and distributions are tracked and reported, with users able to monitor their share via the WazirX app.

ALSO READ: WazirX User Access Issues: Why Did Users Lose Access to Crypto on WazirX?

WazirX Hack: Community Involvement & Voting

WazirX’s plan is notable for its high degree of user involvement:

• Voting: Over 93% of creditors (by value) approved the restructuring scheme in March 2025, far surpassing the legal threshold.
• Creditor Protections: The Scheme of Arrangement ensures that user interests are prioritized and that the process is subject to independent assessment.

WazirX Hack: Challenges, Delays, and User Sentiment

Despite the innovative approach, WazirX’s recovery has not been without controversy:

• Delays: Some users have expressed frustration over shifting timelines, with asset recovery now expected to stretch into 2026 for the final 15%.
• Transparency Concerns: Calls for external audits and clearer communication have grown, particularly as the community demands more accountability from leadership.
• Legal Uncertainty: The outcome of the May 13, 2025, Singapore court hearing remains pivotal. If the scheme is not approved, liquidation could follow, likely resulting in lower and delayed recoveries.

Comparison: WazirX Hack Recovery vs. Other Major Crypto Recoveries

Exchange	Hack/Collapse Year	Recovery Plan	Initial Payout Timeline	Final Recovery Estimate	User Involvement	Token Replacement
WazirX	2024	Scheme+ RTs	<1  year (85%)	2–3 years (100% target)	Yes (voting)	Yes  (RTs)
FTX	2022	Liquidation	2+ years (pending)	Uncertain	Limited	No
Mt.Gox	2014	Liquidation	11 years+ (pending)	Uncertain	Limited	No
Quadriga CX	2019	Liquidation	5+ years (pending)	Uncertain	Limited	No

WazirX’s approach is widely regarded as faster and more user-centric compared to the protracted liquidations seen in other major crypto collapses.

Asset Recovery: Progress & Prospects

• Frozen Funds: As of January 2025, $3 million in stolen assets have been frozen, with ongoing efforts to recover more.
• Illiquid Assets: WazirX is also targeting $18.2 million in illiquid tokens held on third-party platforms or under dispute.
• Bounty & Partnerships: The bounty program and partnerships with forensic experts and law enforcement are ongoing, with hopes of further breakthroughs.

What Should WazirX Users Do Now?

1. Stay Informed: Monitor official WazirX updates, particularly regarding the Singapore court decision in May 2025.
2. Verify Claims: Ensure your account information and claim details are accurate and up to date.
3. Understand RTs: Familiarize yourself with how Recovery Tokens work, their buyback schedule, and potential tradability.
4. Be Patient but Vigilant: While the first distribution is expected soon after court approval, full recovery may take 2–3 years and depends on WazirX’s operational success.

Conclusion: A New Model for Crypto Recovery?

WazirX’s recovery efforts and token replacement plan represent a bold experiment in crisis management for crypto exchanges. By combining immediate restitution with a longer-term, profit-linked recovery token, WazirX aims to balance user needs, operational realities, and market innovation. The plan’s success now hinges on court approval, continued asset recovery, and the exchange’s ability to rebuild trust and profitability.

For affected users, the coming months are crucial. While the path to full recovery is not without risk, WazirX’s approach offers a level of transparency, speed, and user involvement that sets a new benchmark in the industry.

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FAQs

1. What happened during the WazirX hack in July 2024?
In July 2024, WazirX suffered a major cyberattack attributed to North Korean hackers, leading to a loss of over $234 million in user assets and a complete halt in trading and withdrawals.

2. How will affected users be compensated?
Users will receive about 85% of their July 2024 portfolio value after court approval, either in original tokens or USDT. The remaining 15% will be issued as Recovery Tokens (RTs), redeemable through periodic buybacks.

3. What are Recovery Tokens (RTs) and how do they work?
RTs represent users’ claims to the remaining 15% of lost funds. WazirX will buy back RTs quarterly using profits and recovered assets, with the goal of full recovery over 2–3 years.

4. When will users receive their first distribution?
If the Singapore court approves WazirX’s recovery plan on May 13, 2025, users may receive their first distribution within 10 business days—likely before June 2025.

5. What happens if the court does not approve the recovery plan?
If the Singapore court rejects the scheme, WazirX may enter liquidation. This would likely delay recoveries and result in smaller payouts for users.