An Indian high court issued a ruling that could impact how cryptocurrency exchanges handle claims filed by users following a hack or other incident potentially affecting their holdings.
In a ruling delivered on Saturday, Justice N. Ananad Venkatesh of India’s High Court of Judicature at Madras ordered crypto exchange WazirX’s operator, Zanmai Lab, to furnish a bank guarantee for about $11,800 as part of arbitration proceedings brought by a user over 3,532 XRP (XRP) holdings. Zanmai has custody of the tokens, which were frozen after a 2024 cyberattack resulted in the loss of about $235 million worth of crypto.
“Since the cyber attack took place, there are insufficient crypto currency tokens attributable to the platform’s user liabilities to satisfy unsecured crypto currency claims of its users,” said the Saturday filing.
“Hence, the [company] devised a solution for the benefit of platform’s users through a scheme of arrangement under the Singapore Companies Act, which would provide a mechanism for a fair and orderly manner of distribution pursuant to the scheme under the supervision of the Singapore Courts.”
In the same ruling, Venkatesh declared cryptocurrency was a property “capable of being enjoyed and possessed” and “being held in trust” for legal purposes, such as the claim the WazirX user made regarding her XRP tokens. WazirX is headquartered in India, but its parent company, Zettai, is based in Singapore, making the claims process for users legally complicated.
Related: WazirX bets on zero-fee crypto trading to drive relaunch after long hiatus
Last week, WazirX announced that it would restart its operations more than a year after the $235-million hack. The company relaunched trading on Friday as the first step of a phased reboot — the first movement since it halted transactions in July 2024.
Restructuring plan in Singapore
After the 2024 hack, Zettai worked under Singapore’s legal system to develop a restructuring plan for affected users. The country’s high court approved the plan on Oct. 13, setting the groundwork for users to be repaid after more than a year in limbo.
With the court decision out of India — and many WazirX users based in the country — the implications for Zettai’s plan remain unclear. Cointelegraph reached out to WazirX for comment but had not received a response at the time of publication.
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