Court Ruling Against WazirX Puts Spotlight on Zensui’s Global Legal Exposure

WazirX’s rebrand to Zensui hasn’t shielded it from mounting legal exposure. The Bombay High Court this week ordered the exchange’s operator, Zanmai Labs, to post bank guarantees worth more than ₹45 crore (about $5.4 million) in favor of CoinSwitch. It rejected arguments that last year’s $234 million hack absolved the company of responsibility. The WazirX CoinSwitch court ruling marks a clear precedent: crypto exchanges cannot escape custodial liability. Not even through corporate restructuring or rebranding.

The CoinSwitch Ruling: India’s First Clear Custody Precedent

The Bombay High Court verdict stemmed from CoinSwitch’s long-running effort to recover frozen assets trapped on WazirX after the 2024 breach. Judges dismissed WazirX’s claims of force majeure and its attempt to shift blame to Binance under an earlier acquisition agreement. Instead, the court reaffirmed that the platform holding client assets remains the custodian of those assets. It therefore must safeguard them regardless of external events.

CoinSwitch called the outcome a victory for investor protection, noting that the decision could help restore user trust in Indian exchanges. Legal experts view it as the first major Indian case to establish the accountability of crypto exchanges through enforceable guarantees.

How the $234 Million WazirX Hack Sparked Years of Litigation

The WazirX hack in July 2024 drained roughly $234 million from multi-signature wallets holding client and partner funds. Investigators later traced several of the transfers to addresses linked with North Korean–affiliated groups. CoinSwitch was one of the most affected counterparties, with nearly ₹62 crore in frozen assets.

The hack triggered arbitration claims, asset freezes, and parallel criminal probes, eventually culminating in the current court orders. For users and counterparties, it exposed how thin the legal line is between operational loss and custodial breach.

>>> Read more: WazirX Hack: $235M Laundered Through Tornado Cash

India Turns Up the Heat on Zensui

The CoinSwitch recovery battle is not WazirX’s only legal problem. In August, the Delhi High Court directed WazirX’s Singapore-based parent, Zettai Pte Ltd, to disclose acquisition records tied to Binance. This move could finally clarify who ultimately controls the exchange’s assets. Separately, Delhi prosecutors asked the Central Bureau of Investigation to review a ₹2,000 crore crypto-fraud file that overlaps with the WazirX case.

Together with the Bombay ruling, these steps signal a stronger judicial appetite to test the limits of Indian crypto regulation and exchange transparency.

Singapore’s Parallel Restructuring Battle

While Indian courts hand down rulings, WazirX’s parent is still entangled in Singapore. The Singapore High Court rejected the company’s first restructuring plan in June 2025, citing compliance and creditor-protection gaps. A revised plan later won creditor approval. Another Singapore restructuring hearing is scheduled for October 13, 2025, to decide whether the scheme will be sanctioned.

The company remains under a moratorium, shielding it from new lawsuits. However, each delay deepens creditor frustration and raises questions about Zensui’s solvency.

>>> Read more: WazirX Recovery: A Crucial Vote for Creditors

The Panama Move and the Zensui Rebrand

In June, WazirX announced its migration to Panama under the name Zensui Corporation. The firm described the relocation as a strategic step to serve global users, but many observers see it as an attempt to reset operations outside Singapore’s regulatory reach. This Zensui rebrand creates additional uncertainty for creditors, as enforcement of Indian or Singaporean judgments in Panama remains untested.

Critics warn that the Panama crypto relocation may complicate recovery efforts and weaken user protections.

What the Verdict Means for Exchanges Everywhere

The WazirX CoinSwitch court ruling does more than settle a single dispute. It sets a standard! By defining custodial liability as a legal obligation, Indian courts have effectively raised the bar for crypto custody nationwide. Whether or not Singapore approves Zensui’s new plan, the message is clear: legal responsibility follows the assets, not the brand name.

For investors and regulators alike, this may mark the start of a new enforcement era where exchanges are judged not only by innovation but by accountability.

Closing Line

The CoinSwitch verdict may have begun as a narrow fight over frozen tokens, yet it now resonates across borders. From Mumbai to Singapore to Panama, Zensui’s tangled legal trail proves that in crypto custody, accountability doesn’t vanish with a new logo.