WazirX has filed for a moratorium amidst its ongoing restructuring process following the major hack, which resulted in the theft of digital assets worth ₹2,000 crore.
This move drew attention to a significant development as the fund set aside for the restructuring process increased from ₹100 crore to ₹250 crore. This, raised eyebrows among users, who had questions as to whether additional user assets had been tapped into or not.
Through X, WazirX simplified the ongoing changes in detail, to provide transparency and full understanding of the restructuring process.
What Really Happened?
WazirX clarified that the ₹250 crore ($30 million) restructuring fund, known as “Cost Reserves,” is an extension of the initial ₹100 crore ($12 million) fund set aside for the restructuring process. The additional ₹150 crore ($18 million) was not taken from new assets but was generated through strategic treasury management by increasing the value of the tokens already allocated.
This approach ensured no further tokens were reserved, securing the necessary funds to support a successful restructuring without impacting existing assets.
Why Does This Matter?
The ₹250 crore fund is essential for WazirX’s recovery and restructuring. Initially, ₹100 crore was set aside to cover costs like operations and professional fees.
However, an extra ₹150 crore was needed to support the restructuring process over the next three years. This money is meant to help restart the WazirX platform, launch a new decentralized exchange (DEX), keep the business running, and recover lost or stolen assets to benefit creditors.
WazirX made it clear that this fund is crucial for improving creditor recoveries. They managed to secure the extra funds through smart financial management without using additional assets, ensuring the recovery process stays fair and effective.
Profit Sharing with Creditors
WazirX explained how it will handle profits during the recovery. Until the ₹250 crore fund is fully recovered and shared with creditors, 100% of the company’s profits will go to them. This ensures creditors are the top priority during the restructuring.
After the fund is fully recovered, WazirX will still share 50% of its profits with creditors for the next three years or until all Recovery Tokens are bought back. This plan shows WazirX’s focus towards helping creditors recover their money and rebuilding trust.
This approach ensures that creditors benefit without compromising user assets, positioning WazirX for long-term recovery.
Also Read: WazirX Seeks Creditor Meeting Following Singapore Court Approval
