In a recent statement issued on September 17, Binance has firmly distanced itself from the troubles facing the Indian crypto exchange, WazirX. The ongoing saga surrounding WazirX, particularly following a significant hack that resulted in the theft of approximately $235 million in July, has seen WazirX co-founder Nischal Shetty making assertions that seem to implicate Binance in the fallout. However, Binance has categorically refuted these claims, arguing that they are not only misleading but also an attempt to shirk responsibility for the losses experienced by WazirX users.
Binance’s response comes after Shetty suggested that the challenges faced by WazirX were partially Binance’s responsibility. Binance has labeled this narrative as “outrageously misleading,” and emphasizes that it has never owned, controlled, or operated WazirX at any point in the timeline, including prior to, during, or after the hack in question. The exchange insists that the attempts by WazirX to deflect blame onto them are concerning, urging a focus on the real problem: the urgent need for accountability from the WazirX management for the user funds that went missing under their stewardship.
Earlier discussions of a potential acquisition between Binance and WazirX have contributed to some confusion. Binance clarified that although there were negotiations in place and a contract was signed to potentially finalize the acquisition, the actual transaction never came to fruition. They firmly stated that “Binance never acquired or controlled WazirX,” a position supported by reference to the inability of Zettai—WazirX’s then-affiliated company—to meet their obligations.
WazirX is officially owned by Zanmai Labs Pvt Ltd, a firm incorporated in India. Binance has asserted that any inference by Shetty indicating that Zettai’s creditors could pursue claims against Binance lacks any legal foundation. They dismissed suggestions of responsibility, reaffirming that the narrative constructed by Shetty was fundamentally flawed. This legal clarification is crucial amidst the chaos of financial mismanagement that has characterized the recent events surrounding WazirX.
Adding to the complexities, Binance has admitted that it provided technological support to WazirX in the past. However, they have made it abundantly clear that their role in the custody of funds was severed well before the hack occurred. Notably, the choice of Liminal as a custody provider was made independently by WazirX’s management, without Binance’s input, further disassociating them from the events that led to the theft.
Binance’s attempts to assist WazirX during this crisis have reportedly been met with resistance, underscoring an unfortunate breakdown in communication and cooperation. As both parties navigate this tumultuous situation, the pressing issue remains the accountability of the WazirX team. Binance’s emphasis on detachment from the operational affairs of WazirX serves as a critical reminder of the importance of corporate transparency and responsibility, especially in a sector rife with vulnerabilities like cryptocurrency trading. The trade-off between innovation and accountability has never been clearer, and the ultimate outcome of this battle may set a precedent for the future operations of crypto exchanges globally.