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Dear Tribe! 🙏
Zettai Pte Ltd filed an application with the Singapore High Court on December 6, 2024, for leave to convene a meeting of its creditors to present and vote on a Scheme of Arrangement (“Scheme“).
The Scheme is aimed at providing the users of WazirX (“Scheme Creditors“), who are unsecured contingent Creditors of Zettai, with quick and fair recovery. This move will enhance transparency, rebuild trust, and stabilize the exchange.
Fast Relief for Creditors
The proposed Scheme, filed in the Court under mainly the Companies Act 1967 on December 6, 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 has reached this stage with the confidence to propose a Scheme following the Singapore High Court’s decision on September 26, 2024, to grant a four-month moratorium. This period allowed Zettai 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 July 18, 2024.
If approved, the proposed Scheme will include initial distributions within 10 Business Days (as defined in the proposal) after it becomes 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 July 18, 2024, will be disbursed to the 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 July 18, 2024, 1:00 PM IST)
Liquid Assets: 566,385,206 USDT (as of December 5, 2024, 10:00 AM IST)
The value of current liquid assets exceeds total claims in USD equivalent as of July 18, 2024, offering Scheme Creditors a promising opportunity for full recovery of their USD equivalent claims as of July 18, 2024, and potential additional returns.
Efficient Recovery Roadmap
The Scheme provides a clear, transparent, and time-bound framework for fund recovery, ensuring Scheme Creditors benefit from both immediate distributions and long-term recoveries.
The Scheme follows a structured timeline of events, allowing Scheme Creditors to vote on the proposal through a third-party independent platform. The results of the vote will be verified by a reputable third-party scrutineer. For the Scheme to proceed, it must secure approval from a majority in number and at least 75% in 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.
Key Highlights of the Scheme:
- 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.
- Recovery Tokens: Scheme Creditors will further receive Recovery Tokens. These will be redeemed systematically with the Platform’s recovery efforts.
- 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.
- 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.
- New Revenue Streams: Zettai plans to launch a decentralized exchange (DEX), with any profits from the DEX contributing to the recovery pool.
We are doing everything possible to recover the assets and restart the Platform. We also want to thank our users for their patience and support during this challenging time.
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.
