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Dear WazirX Users,
The Singapore High Court has granted leave to Zettai Pte Ltd, allowing the Company to convene a scheme meeting with the Creditors.
This decision is a significant step in Zettai’s efforts to distribute Net Liquid Platform Assets to creditors and revive operations at the WazirX Platform.
Zettai wishes to take this opportunity to reiterate its commitment to addressing Creditors’ concerns and implementing a comprehensive restructuring plan to facilitate recovery in a structured manner.
Understanding The Scheme of Arrangement
Under Singapore’s Insolvency, Restructuring, and Dissolution Act 2018 (IRDA), a Scheme of Arrangement allows a Company to propose a debt restructuring plan to its Creditors. This approach aims to provide the fastest, fairest, creditor-approved, and legally binding resolution to crypto balances.
Approval of the Scheme by creditors requires at least 50% vote in favor, and at least 75% of creditors by value in each class present and voting. Once approved, the Scheme will be sanctioned by the Court, becoming legally binding for both the Company and its creditors. This process ensures transparency and sets clear timelines for informed decision-making.
Key Highlights of the Scheme:
- Rebalanced Net Liquid Platform Assets (NLPA): Users can now view their share of the Rebalanced NLPA in the WazirX app, which will be made available in the First Distribution, if the proposed Scheme is approved by creditors and sanctioned by the Court.
- Scheme Process & Voting Timelines: Voting on the proposed Scheme is expected to take place between 19 March 2025 and 28 March 2025 via the KIS platform.
- First Distribution Timeline: If the Scheme is effective, the first distribution will be completed within 10 business days of the Effective Scheme Date, with a tentative timeline of April/May 2025.
- Estimated Recoveries: Creditors are expected to receive an average of ~85.3% recovery (in USD terms) relative to their Balances from the Rebalanced Net Liquid Platform Assets, with potential subsequent distributions to be made through the issuance of Recovery Tokens (RTs).
- Recovery Tokens (RTs): Creditors will receive RTs on a pro-rata basis, allowing participation in future asset recoveries and profit-sharing from the WazirX platform reactivation.
- Asset Recovery Efforts: Structured plans are in place to recover stolen and illiquid assets, including forensic investigations and legal actions, and they are intended to be continued alongside the proposed Scheme.
Why Vote YES for Restructuring?
Faster Access to First Distribution: Receive your allocation of Rebalanced Net Liquid Platform Assets in tokens within 10 business days of Scheme being effective, without unnecessary delays!
Fair Treatment for All: Receive your proportional allocation of recoveries and distributions – all creditors (big or small) are treated equally.
Future Recoveries: Illiquid Platform Assets: Future recovery opportunities as Illiquid Wallet Assets and Stolen Assets are recovered over time.
Future Recoveries: Profit Sharing: Net available profit sharing from a planned platform reactivation and DEX to further improve recoveries!
Market Exposure and Potential Upside: Participate in future market movements with token distributions instead of fiat, allowing you to capture potential crypto market gains.
Legally Binding: Once successful and effective, the Scheme legally binds Zettai to deliver its terms, driving transparency, trust and accountability.
What Happens If The Restructuring Fails?
Risky, Uncertain and Delayed Process: A liquidation cannot commence until the ownership dispute is resolved. Significant risk and uncertainty lead to highly delayed recoveries under a liquidation.
Lower Recoveries: High Liquidation Costs: Recoveries under a liquidation will be lower than in a restructuring due to high liquidation costs arising from the large creditor base, Liquidator statutory requirements, and loss of key staff and infrastructure in a liquidation.
Lower Recoveries: Less Effective Asset Recovery Efforts: Given the significant delay before a liquidation can commence, recovery efforts for Illiquid Platform Assets are likely to cost more and be less effective, leading to lower recoveries for you.
Lower Recoveries: No Profit Sharing: As liquidation is terminal, the WazirX platform will likely be closed permanently. You will miss out on recoveries from profit sharing planned under the restructuring from reactivated trading and the DEX.
FIAT Distributions Limit Market Exposure: Under a liquidation, creditors will receive distributions in fiat, which does not allow participation in the crypto market movement and upside.
Limited Say In Liquidation: A liquidator will run the liquidation and is not obligated to take on creditor input. Creditors like yourself get limited say in the way the liquidation is run.
Choose Wisely!
The Scheme provides the most effective path for Scheme Creditors to achieve quicker recovery. Its approval would ensure a structured resolution, avoiding delays and uncertainties that come with other alternatives.
Given its clear advantages over alternative solutions, supporting its approval would be in the best interest of all stakeholders.
Disclaimer: Cryptocurrency is not a legal tender and is currently unregulated. Kindly ensure that you undertake sufficient risk assessment when trading cryptocurrencies as they are often subject to high price volatility. The information provided in this section doesn't represent any investment advice or WazirX's official position. WazirX reserves the right in its sole discretion to amend or change this blog post at any time and for any reasons without prior notice.
