- Binance refutes any ownership of WazirX and denies culpability for the recent $235 million hack, emphasizing the need for WazirX to address user fund losses.
- The controversy stems from a hack on WazirX in July 2024, leading to significant user fund losses, with Binance distancing itself from responsibility.
- Nischal Shetty, the main owner of Zettai Pte Ltd (linked with WazirX), has provided affidavits to the Singapore High Court alleging connections with Binance, which the latter disputes.
Binance categorically denies ownership of WazirX and responsibility for the $235 million fund hack, pointing to WazirX’s obligation to recover user losses.
Binance’s Official Stance on WazirX Ownership and Fund Management
In a recent blog post, Binance categorically refuted the ownership of WazirX, an Indian crypto platform, and asserted that it bears no responsibility for the $235 million hack that occurred in July 2024. This statement follows allegations made by Nischal Shetty, who, representing Zettai Pte Ltd, claimed in court documents that Binance has ties with WazirX. These claims were presented as part of a moratorium application aimed at protecting the company from creditors.
The Disputed Acquisition and Ownership Claims
Binance clarified that while it did sign a contract related to acquiring WazirX, the acquisition was never finalized due to Zettai Pte Ltd’s failure to meet certain prerequisites. Binance emphasized that it has never owned, controlled, or managed WazirX operations, distancing itself completely from WazirX’s contractual obligations with its users. The exchange highlighted that any references to Binance in WazirX’s user agreements were unauthorized and not indicative of any official relationship.
Responsibility for the Security Breach
Regarding the security breach, Binance maintained that it bears no liability for the hack, which resulted in a substantial financial loss for WazirX users. Binance stated that in January 2023, it had instructed Zanmai, a company associated with WazirX, to transfer funds from Binance-hosted wallets to another custody solution. This transfer was reportedly completed prior to the hack.
Selection of Custody Solution by WazirX
The responsibility for selecting the new custody solution provider, Liminal, was solely that of Nischal Shetty and Zettai Pte Ltd, without any involvement from Binance. The compromised wallet during the hack was under Liminal’s management, and Liminal has also denied accountability for the breach.
Calls for Transparency and Accountability
Binance revealed that it had requested reports related to the incident from WazirX, including a cybersecurity report purportedly prepared by Mandiant and dated August 14, 2024. However, Binance has yet to receive these reports. The exchange urged the WazirX team to take full responsibility for addressing the concerns of their users regarding the lost funds, stressing that such responsibilities lie with WazirX and not Binance.
Conclusion
In summary, Binance has unequivocally denied any ownership of WazirX and responsibility for the recent $235 million hack. It has highlighted the need for WazirX to take accountability for securing user funds and addressing the fallout from the breach. This ongoing dispute underscores the importance of clear ownership and responsibility delineation in the rapidly evolving cryptocurrency landscape, ensuring users’ trust is maintained through transparency and accountability.
