Binance has issued a firm rebuttal against allegations from WazirX’s Nischal Shetty, who has attempted to implicate Binance in the aftermath of the July 2024 cyber-attack that compromised approximately $230 million in user funds. Binance clarified that it has never owned or controlled WazirX and bears no responsibility for its recent security breach.
The matter came to light during a town hall organised by WazirX’s team on YouTube. Here, Nischal Shetty explained that Binance operated both crypto and associated activities of WazirX until January 2023. After that, Zettai Pte Ltd took partial control of the crypto tokens “under protest,” and Zettai maintains that Binance has no basis for termination and still operates crypto assets.
Furthermore, the dispute between Zettai and Binance is confidential. It is still unclear who owns WazirX, leading to confusion about the contractual counterparty for users.
Binance provided a document by the Enforcement Directorate that legally recognises Zanmai Labs, a company registered in India, as the owner of WazirX. Despite this, Shetty and his team publicly imply that Binance has a stake in WazirX. Binance stated that while a contract was signed between the two parties in the past, the transaction never closed, and WazirX remained under the ownership of Zanmai Labs.
“Binance never acquired or controlled WazirX. While a contract had been signed between the parties, the proposed transaction never closed due to Zettai’s failure to perform its obligations. Binance has never owned, controlled, or operated WazirX at any time, including before, during, or after the alleged hack,” Binance said.
Binance also clarified that WazirX’s compromised wallet was managed solely by the WazirX team and their custody provider, Liminal, with no operational input from Binance. The company further clarified that after January 2023, Binance had no stakes in WazirX and had given ample notice to withdraw all funds from Binance’s wallets.
“Who owns or controls WazirX is not an issue that will be resolved in the ongoing dispute. As we have repeatedly made clear previously, Binance does not own or control WazirX. Zettai and its affiliates accept that they still operate WazirX,” Binance continues. “In the dispute, Zettai and its affiliates are not seeking a declaration that Binance is the owner, controller, or operator of WazirX.”
Shetty has also claimed that Binance’s name appears in WazirX’s User Agreement, suggesting a level of involvement in cryptocurrency-related services. Binance strongly rejected this claim, noting the inclusion of its name in the User Agreement was unauthorised, and it had previously requested its removal. Despite these requests, WazirX continued referencing Binance in its user agreements.
“The WazirX User Agreement suggesting that Binance provides services to WazirX users is incorrect and misleading. The references to Binance on the WazirX User Agreement have never been authorised or agreed by Binance,” Binance clarifies.
Binance also distanced itself from the fallout of the cyber-attack, asserting that it bears no responsibility for the compromised wallet. The selection of Liminal as the custodian of user funds was solely WazirX’s decision, with Binance neither consulting nor being informed about this arrangement.
In the wake of the attack, Binance has requested WazirX to provide detailed reports on the cyber-attack, including an internal review and findings on cybersecurity firm Mandiant. However, these requests have gone unanswered.
“The security and protection of user funds is a fundamental responsibility of any cryptocurrency platform. We urge the WazirX team under Zanmai/Zettai to be accountable to WazirX users and compensate them for the funds lost under Zanmai/Zettai management,” said the company.
With this rebuttal, WazirX’s problems will rise. The platform has filed a moratorium in the High Court of Singapore and is in talks with 11 cryptocurrency exchanges for capital infusion.
Meanwhile, users are still in limbo, and hackers are moving millions of dollars worth of ETH to Tornado Cash, a mixing service.
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