WazirX Latest News: Court Updates & User Payouts Explained

The Indian crypto community has been closely following the dramatic saga of WazirX, once the nation’s largest crypto exchange, since its catastrophic hack in July 2024. With over $230 million in user assets stolen and months of uncertainty, users are now anxiously awaiting the outcome of a pivotal Singapore court hearing on May 13, 2025. 

This blog unpacks the latest developments, court proceedings, and the detailed payout plan for affected users, presenting a clear, comprehensive, and up-to-date analysis.

Latest Update: As of June 4, 2025

The General Division of the High Court of the Republic of Singapore has sent a letter to Zettai Pte. Ltd., the company that runs WazirX, asking their lawyers to answer a set of very specific questions. These questions are about whether WazirX is following certain financial rules and what their plans are to comply with regulations in Singapore and India. Here’s what the court is asking-

Confirming Licensing Requirements in Singapore:

• The court is pointing out that a new law, the Financial Services and Markets Act 2022 (FSM Act), starts on 30 June 2025 in Singapore. According to this law, Zettai cannot operate WazirX without a specific license, known as a DTSP Licence, from the Monetary Authority of Singapore (MAS), Singapore’s financial regulator.
• The court wants Zettai to confirm that they understand they can’t run WazirX after 30 June 2025 without this license.

Will Zettai Apply for the Singapore License?:

• The court is asking whether Zettai plans to apply for the DTSP Licence to keep running WazirX legally in Singapore.

Details About the License Application (if applicable):

• If Zettai says “yes” to applying for the DTSP Licence, the court wants to know:
  • When they plan to submit the application.
  • How long do they think it will take for MAS to decide on their application (i.e., when they expect to get the license or be rejected)?

Steps to Register with FIU-IND in India:

• The court is asking what specific steps Zettai needs to take to register WazirX as a reporting entity with the Financial Intelligence Unit-India (FIU-IND). 
• They also want Zettai to explain the process they need to follow to get registered in India.

Will Zettai Register with FIU-IND?:

• The court wants to know if Zettai plans to apply for registration with FIU-IND for WazirX’s operations.

Details About the FIU-IND Registration (if applicable):

• If Zettai says “yes” to registering with FIU-IND, the court wants to know:
  • When they plan to apply for this registration.
  • How long do they think it will take for FIU-IND to decide on their application?

Here’s a detailed breakdown of the court’s queries and the response provided by WazirX’s legal team-

Court Query 1: Confirming Licensing Requirements in Singapore

What the Court Asked: The court noted that starting 30 June 2025, the FSM Act will require Zettai to have a Digital Token Service Provider (DTSP) Licence from the Monetary Authority of Singapore (MAS) to operate WazirX outside Singapore. They asked Zettai to confirm they understand they can’t run WazirX without this license after that date.

Zettai’s Response:

• Zettai agrees that, under the new FSM Act, they would need a DTSP Licence to operate WazirX’s cryptocurrency services after 30 June 2025 if they were doing so as a Singapore-based company.
• However, they argue this rule won’t stop their planned Scheme (a restructuring plan, likely to distribute assets to creditors after a financial issue, possibly a cyberattack). Here’s why:
  1. First Distribution Isn’t a Regulated Activity: The “First Distribution” (paying out remaining assets to creditors, like users owed money) doesn’t involve Zettai running a full crypto exchange or dealing with digital tokens in a way that requires a license. They say this is a one-time payout, not a continuous business operation, so it doesn’t fall under the FSM Act’s licensing rules.
  2. Shifting Operations to a Non-Singapore Subsidiary: Zettai has already started moving WazirX’s crypto-related operations to a subsidiary called Zensui Corporation, incorporated in Panama (outside Singapore). Since the FSM Act only applies to Singapore-based companies, Zensui (as a foreign company) wouldn’t need a Singapore license. They’ve finalized a “Transfer Agreement” to hand over operations to Zensui, which will take 2-3 business days to complete once signed.

Court Query 2: Does Zettai Plan to Apply for the DTSP Licence?

What the Court Asked: The court inquired whether Zettai intends to apply for the DTSP Licence to operate WazirX in Singapore after June 30, 2025, in a legally compliant manner.

Zettai’s Response:

• Zettai says they don’t plan to apply for the DTSP Licence.
• They argue that their Scheme (the plan to pay creditors and possibly resume operations) doesn’t depend on getting this license because:
  • The First Distribution (paying out assets) doesn’t require a license.
  • They’re moving crypto operations to Zensui in Panama, which isn’t subject to Singapore’s FSM Act.

Court Query 3: Steps to Register with FIU-IND in India

What the Court Asked: The court asked Zettai to explain the steps required to register WazirX as a reporting entity with FIU-IND, which monitors financial transactions to prevent money laundering and terrorism financing.

Zettai’s Response:

• Zettai lists the general steps any company (not specifically WazirX) would need to follow to register with FIU-IND as a Virtual Digital Asset Service Provider (VDA SP):
  1. Sign Up Online: Register on FIU-IND’s portal (FINGate) by creating an account.
  2. Appoint Key People: Name a “Designated Director” and a “Principal Officer” and enroll them on the portal.
  3. Provide Information: Submit details about the company’s activities, corporate structure, ownership, agreements with other entities (in or outside India), and answers to an FIU-IND questionnaire.
  4. Submit Documents: Provide incorporation papers, financial accounts, tax filings, a “Fit and Proper” certificate from another registered VDA SP, a self-declaration that no legal actions are pending against the company or its directors, and any other documents FIU-IND requests.
  5. Attend a Meeting: The Designated Director and Principal Officer must attend an in-person meeting with FIU-IND.
• Zettai clarifies that these are general steps for any company, not a confirmation that they need to register with FIU-IND.

Court Query 4: Does Zettai Plan to Register with FIU-IND?

What the Court Asked: The court inquired whether Zettai intends to register WazirX with the FIU-IND for its operations.

Zettai’s Response:

• Zettai says they (or their Panama subsidiary, Zensui) don’t plan to register with FIU-IND for WazirX’s operations. Here’s why:
  • Their Indian legal advisor, Justice Srikrishna, states that Zettai hasn’t broken any Indian laws by not registering with the FIU-IND. There is no rule in India preventing Zettai from operating a crypto platform like WazirX without an FIU-IND registration.
  • FIU-IND registration is primarily aimed at preventing money laundering and terrorist financing, but Zettai argues that these rules don’t affect the legality of their crypto operations.
  • Another Zettai subsidiary, Zanmai India, is already registered with FIU-IND and handles all reporting duties for WazirX, including for crypto-to-crypto and INR-to-crypto transactions. Zanmai India has been communicating with FIU-IND since August 2023, confirming that another entity (not Zanmai) handles crypto-to-crypto transfers, and FIU-IND hasn’t objected or asked Zettai to register.
  • Neither Zettai nor Zanmai India has received any notice or penalty from FIU-IND about registration before or after the cyberattack.
  • Zanmai India already submits suspicious transaction reports and responds to FIU-IND’s requests, covering all WazirX operations, so Zettai believes additional registration isn’t needed.

Court Query 5: If Registering with FIU-IND, When and How Long?

What the Court Asked: If Zettai plans to register with FIU-IND, the court wanted to know-

(a) when they would apply and

(b) how long they expect it to take for FIU-IND to decide.

Zettai’s Response:

• Since Zettai (or Zensui) doesn’t plan to register with FIU-IND (as stated in Query 4), this question doesn’t apply.
• However, they add that if new Indian regulations require registration in the future, they or Zensui could register without any major issues. They also note that Zanmai India, their subsidiary, is already registered with the FIU-IND for WazirX’s operations.

Background: The 2024 WazirX Hack

In July 2024, WazirX suffered a devastating cyberattack attributed to North Korean hackers, resulting in the theft of nearly $235 million in crypto assets. The breach forced the exchange to halt all withdrawals and trading, leaving millions of users in limbo and triggering a crisis of confidence in Indian crypto platforms.

Legal and Court Updates: Where Do Things Stand?

Singapore High Court: The Decisive Hearing

• Date of Hearing: May 13, 2025
• Purpose: To sanction (approve) WazirX’s proposed restructuring and user compensation plan.
• What’s at Stake: If the court approves the plan, WazirX can restart operations and begin user payouts within 10 business days. If not, the timeline for recovery could stretch well into 2026, or even longer.

How Did We Get Here?

• Moratorium & Scheme Proposal: In early 2025, WazirX’s parent company, Zettai Pte Ltd, secured a 16-week moratorium from the Singapore High Court to pause legal actions and focus on a restructuring plan.
• Creditor Voting: In March–April 2025, over 93% of voting creditors (representing 94.6% of claim value) approved the restructuring plan, far exceeding the statutory threshold.
• Court Filing: Zettai filed the sanction application in April, setting the stage for the May 13 hearing.

Indian Courts: Limited Relief

• NCDRC Dismissal: The National Consumer Disputes Redressal Commission (NCDRC) dismissed a class action lawsuit against WazirX in April 2025, citing jurisdictional limitations.
• Supreme Court: The Supreme Court of India also dismissed petitions, stating it lacked authority over crypto policy and advising petitioners to approach regulators instead.

User Payouts: The Recovery & Compensation Plan

How Will Users Get Their Money Back?

WazirX’s recovery plan is built around a “Scheme of Arrangement” under Singapore law. Here’s how it works:

Step	Description
1	Rebalancing: Calculated each user’s claim as a proportion of total verified liabilities.
2	First Distribution: Users will receive, on average, 85% of their portfolio value as of the hack, paid in crypto tokens or USDT for illiquid assets.
3	Recovery Tokens (RTs): For the remaining 15%, users receive tradable Recovery Tokens, which represent claims on future profits and asset recoveries.
4	Buybacks & Profit Sharing: RTs will be bought back quarterly using WazirX’s profits and any recovered assets, with the process expected to take 2–3 years.
5	Future Asset Recovery: WazirX continues to pursue legal and forensic efforts to recover stolen or illiquid assets, which could boost future payouts.

Payout Timeline Table

Milestone	Estimated Date/Period	Details
Court Hearing	May 13, 2025	Singapore High Court to approve restructuring plan
First Distribution Begins	Within 10 business days post-approval	85% of user claims paid in crypto/USDT
Recovery Token Buybacks	Quarterly,post-relaunch	RTs bought back using profits and recovered assets
Full Recovery Target	By 2027–2028 (optimistic)	The remaining 15% will be paid out subject to WazirX’s financial recovery
Delayed Scenario	2026 or later	If the court delays or rejects the plan, payouts could be pushed further

What Are Recovery Tokens (RTs)?

• Nature: RTs are digital tokens representing the remaining 15% of user claims.
• Tradability: RTs may be listed for trading if there’s sufficient user interest, providing liquidity and market-based valuation.
• Buyback Mechanism: WazirX will repurchase RTs quarterly as profits and recovered assets exceed $10 million, gradually returning value to users.

How Much Will Users Recover?

Recovery Component	Percentage	Method/Timeline	Notes
First Distribution	~ 85%	10 business days post-court approval	Paid in crypto tokens or USDT
Recovery Tokens (RTs)	~15%	Over 2–3 years (quarterly buybacks)	Value depends on WazirX’s profits and asset recovery
Total Potential Recovery	100% (target)	By 2027–2028 (if all goes well)	Subject to successful relaunch and asset recovery

Note: Actual recovery may vary based on WazirX’s future profits and success in recovering stolen assets.

ALSO READ: Will I Get My Money Back from WazirX Hack?

User Experience: Steps to Claim Funds

1. Check Allocation: Users can view their computed token breakdown and current market value on WazirX’s First Distribution page.
2. Account Verification: Users may need to verify their accounts to claim their share of the distribution
3. Stay Updated: Regular updates are provided via the WazirX app, blog, and official social media channels.
4. Monitor RT Value: Users can track RT market value and decide whether to hold or sell once trading is enabled.

Community Reaction & Ongoing Concerns

User Sentiment

• Support for Plan: Over 93% of creditors backed the restructuring, preferring it over liquidation and a potentially years-long wait for uncertain returns.
• Frustration & Distrust: Many users remain angry about delays, vague communication, and a lack of external audits. Some have accused WazirX leadership of broken promises as timelines have shifted from mid-2025 to possibly 2026 in some communications.
• Transparency Demands: The crypto community is calling for external audits and greater clarity on asset recovery efforts.

Potential Risks

Risk Factor	Impact
Court Rejection/Delay	Payouts could be pushed to 2026 or later
Insufficient Profits	RT buybacks may be slow or limited
Regulatory Hurdles	Gradual reopening and compliance may slow withdrawals
Asset Recovery Uncertainty	Full 100% recovery is not guaranteed

What Happens Next? Key Dates & What to Watch

Event	Date/Status	What It Means
Singapore Court Hearing	May 13, 2025	Gradual return of the remaining 15%
First User Payouts	Late May 2025 (if plan approved)	85% of claims distributed in crypto/USDT
Recovery Token Buybacks Begin	Q3 2025 (projected)	Gradual return of remaining 15%
Gradual Platform Relaunch	May–June 2025 onward	Trading and withdrawals resume in phases

Conclusion: Is WazirX’s Recovery Plan the Light at the End of the Tunnel?

WazirX’s journey from India’s top crypto exchange to the epicenter of a massive hack and legal battle has been turbulent. The upcoming Singapore court hearing on May 13, 2025, is a make-or-break moment. If approved, users can expect to recover the majority of their assets within weeks, with the remainder distributed over the next few years through Recovery Tokens. However, skepticism remains high, and the ultimate success of the plan depends on WazirX’s ability to relaunch, generate profits, and recover stolen assets.

For WazirX users, the coming weeks will be critical. While the recovery plan offers hope, vigilance and patience are still required as the legal process unfolds and the platform works to regain trust and stability.

FAQs

1. What is the significance of the WazirX court hearing on May 13, 2025?

The Singapore High Court hearing on May 13, 2025, will decide whether to approve WazirX’s restructuring plan. If approved, user payouts will begin within 10 business days. 

2. How much of my funds can I expect to recover from WazirX?

Users are expected to recover about 85% of their portfolio value in crypto tokens or USDT shortly after court approval in May 2025. The remaining 15% will be distributed over 2–3 years via tradable Recovery Tokens, subject to WazirX’s profits and asset recovery.

3. What are Recovery Tokens, and how do they work?

Recovery Tokens (RTs) are digital tokens representing the remaining 15% of user claims. They can be traded for liquidity if listed and will be bought back quarterly by WazirX.

4. What steps should WazirX users take to claim their funds?

Users should check their allocation on WazirX’s First Distribution page, verify their accounts as needed, and monitor updates via the WazirX app, blog, or official social media. 

5. What are the risks if the WazirX recovery plan fails?

If the court rejects the plan, payouts could be delayed to 2026 or later. Other risks include insufficient profits limiting Recovery Token buybacks, regulatory hurdles slowing platform relaunch, and uncertainty in recovering stolen assets, which could prevent full 100% recovery.