Zettai Pte, the parent company of WazirX, has initiated insolvency proceedings in Singapore under insolvency laws after suffering a devastating cyberattack.
On July 18, the company was hit by a massive cyber assault that led to a staggering $234.9 million in losses. As a result, Zettai has filed for a moratorium, requesting court protection to stabilise its financial situation and prevent any further issues.
Zettai's filing, which took place on Aug. 23, seeks a six-month period during which the company will be shielded from any resolution for winding up. The company requested that no legal actions be initiated or continued against it without prior court approval. This protection would also extend to preventing any legal processes against its assets unless sanctioned by the court.
Zettai revealed that, following the cyberattack, its assets have been relocated to an undisclosed address. This move has led to concerns among WazirX users and investors, who are anxiously awaiting updates on the company's restructuring efforts.
Zettai has submitted in its filing that it has committed to providing a cash flow forecast to the court, although valuing its cryptocurrency assets might be challenging. The company is also expected to offer periodic updates on the progress of its restructuring and court proceedings through emails, blog posts and push notifications.
In an effort to recover from the crisis, Zettai's management is in discussions with 11 different cryptocurrency exchanges and trading businesses to explore potential rescue financing and strategic partnerships.
To date, three non-disclosure agreements have been signed with major players in the cryptocurrency market. These potential partners are considering various forms of support, including capital injections, profit-sharing arrangements and forensic assistance to recover stolen assets.
Despite the setbacks, Zettai's infrastructure remains intact and capable of supporting new revenue-generating initiatives, according to the filing.
The company's platform continues to serve approximately 16 million users, with 4.4 million holding cryptocurrency balances. The ongoing legal disputes and user complaints, however, pose significant challenges. Zettai has already received nearly 10,000 withdrawal-related communications and several legal notices, which could further complicate its restructuring efforts.
In a press statement, the company said it would be holding a town hall with its advisors through a video conference. The virtual conference will be held in the week post-Sept. 2 to address moratorium and user-related queries.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
