Binance Clarifies Relationship with WazirX Amid $235 Million Hack

Binance denies ownership of WazirX and responsibility for a recent $235 million hack, urging the Indian crypto platform to address user fund losses.

Binance Clarifies Relationship with WazirX

The world’s largest cryptocurrency exchange by volume, has issued a statement clarifying its relationship with the Indian crypto platform WazirX, following a significant hack in July 2024 that resulted in the loss of approximately $235 million in user funds. This clarification comes amid claims from Nischal Shetty, the primary owner of Zettai Pte Ltd, a Singapore-incorporated entity associated with WazirX.

Dispute Over Ownership and Responsibilities

In a detailed blog post released earlier today, Binance responded to Shetty’s allegations made in sworn affidavits to the Singapore High Court. Shetty suggested a closer relationship between WazirX and Binance than Binance acknowledges. Binance refuted these claims, stating it never finalized the acquisition of WazirX due to Zettai’s failure to meet necessary obligations.

“Their attempts to shift responsibility is a disappointing deflection tactic,” Binance stated, emphasizing that the responsibility for managing user funds and addressing the hack lies with the WazirX team. Binance clarifies relationship with WazirX by asserting that it has never owned, controlled, or operated WazirX. The exchange also mentioned that any references to Binance in WazirX’s User Agreement with its customers are unauthorized.

Binance’s Stance on the Hack

Regarding the hack, Binance clarified that it had previously instructed Zanmai, an Indian company linked to WazirX, to withdraw funds from Binance-hosted wallets in January 2023, well before the hack occurred. The compromised wallet was reportedly managed using services provided by Liminal, a custody solution provider chosen by Shetty and Zettai without Binance’s involvement. Liminal has also denied any responsibility for the hack.

Binance highlighted that it had requested but not received any reports on the incident, including a purported analysis from cybersecurity firm Mandiant dated August 14, 2024. The exchange called on the WazirX team to directly address their users’ concerns regarding the lost funds. “This responsibility is separate from any dispute with Binance,” the statement read, urging WazirX to take accountable actions to resolve the situation for affected users.

Call for Accountability

Binance’s firm stance underscores the importance of accountability in the crypto industry, especially when user funds are at stake. By distancing itself from WazirX and clarifying the lack of ownership or operational control, Binance aims to protect its reputation while highlighting the need for WazirX to address the security breach and compensate users accordingly.

As the crypto community watches closely, the fallout from the WazirX hack continues to unfold, with significant implications for user trust and regulatory scrutiny in the crypto industry. Binance clarifies relationship with WazirX to set the record straight and urges the responsible parties to take immediate action.