On 07 November 2024, Nischal Shetty, Director of Zettai Pte Ltd, filed his fifth affidavit in the General Division of the High Court of the Republic of Singapore. This filing, made in line with the requirements of the ongoing insolvency and restructuring proceedings under Section 64 of Singapore’s Insolvency, Restructuring, and Dissolution Act, aims to provide updates on the Company’s financial standing, interactions with the Committee of Creditors (COC), recent engagements with creditors, and future plans for restructuring.
Zettai Pte Ltd, which operates the WazirX cryptocurrency platform, has been under a court-sanctioned restructuring process since September 2024, after facing significant financial challenges due to a major cyber-attack on 18 July 2024. This attack resulted in a 45% asset deficit, prompting the Company to seek a Scheme of Arrangement in Singapore to maximize creditor recovery through a reorganization of assets and liabilities.
On 26 September 2024, the Singapore High Court granted Zettai a four-month moratorium, halting creditor claims until 26 January 2025. Since then, Shetty has filed several affidavits to keep the Court and creditors informed of progress, detailing financial adjustments and recovery efforts. The moratorium has allowed Zettai to focus on strategic planning without the pressure of immediate claims.
In accordance with the Court’s instructions, Shetty’s latest affidavit includes Zettai’s unaudited consolidated management accounts, balance sheets, and profit and loss statements as of 27 August 2024. These documents reflect the Company’s financial health but notably exclude contingent assets and liabilities related to disputed ownership of platform assets. Zettai asserts that these figures are based on accepted accounting principles.
Recent updates were shared with creditors at the 4th Creditors’ Townhall held on 6 November 2024. This virtual meeting, hosted via Zoom and livestreamed on YouTube, aimed to ensure transparency in the restructuring journey and addressed creditor questions in real-time. Zettai’s team, including representatives from Kroll, its financial advisors, explained various restructuring aspects, including efforts to secure additional funding, asset rebalancing, and recovery from the cyber-attack. This townhall followed a second meeting of the Committee of Creditors (COC) on 29 October 2024, where Zettai presented progress and sought feedback on upcoming plans.
The townhall also introduced Zettai’s new Scheme Timeline Calculator, a tool designed to help creditors visualize the projected timeline and track restructuring milestones. By engaging creditors in this manner, Zettai seeks to maintain a collaborative approach and ensure that stakeholders remain informed.
The restructuring has attracted interest from several potential “white knights,” external investors willing to support Zettai’s recovery efforts. These parties are seen as pivotal in enhancing liquidity, with funds being earmarked for recovery efforts, reactivating exchange operations, and exploring revenue generation. Zettai hopes these alliances will bolster creditor recovery and provide a pathway for sustainable growth beyond the restructuring.
Creditor sentiment, as observed in recent COC meetings, reflects both cautious optimism and some urgency. Creditors are particularly focused on:
- Early liquidity options, such as a secondary debt market where they might liquidate holdings before the full restructuring concludes.
- Asset rebalancing and distribution in tokens of their choice.
- Recovery from cyber losses and additional revenue sources, including potential profit-sharing from the WazirX platform, which Zettai plans to reactivate.
The restructuring proposal includes provisions to distribute liquid assets in preferred tokens, pursue recovery of illiquid assets, and work with reputable funds to provide early liquidity options. Zettai has also promised to release an “asset allocator simulator” soon, enabling creditors to understand the rebalancing process better. The role of COC members is vital, as they serve as creditor representatives in guiding the restructuring. Members are expected to actively engage in meetings and discussions to support consultative decisions. During the formation of the COC, six members were identified as inactive
