Binance CEO Changpeng Zhao Gets into Verbal Spat with WazirX Founders on Twitter

Changpeng Zhao warned Binance can shut down WazirX but it would hurt users.

Binance CEO And WazirX Founder At Loggerheads Over Money Laundering Case On Indian Crypto Startup

After the Indian Federal Enforcement Directorate (ED) launched an investigation into WazirX for laundering $350m and froze the Binance-acquired Indian crypto startupโ€™s assets, Binance CEO Changpeng Zhao tweetedย that the acquisition transaction โ€œwas never completed.โ€

โ€œOn 21st November 2019, Binance published a blog post that it had โ€œacquiredโ€ WazirX – this transaction was never completed,โ€ clarified Zhao. โ€œBinance has never – at any point – owned any shares of Zanmai Labs, the entity operating WazirX.โ€ย 

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Recently, Zanmai Labs has also come under EDโ€™s purview of investigation.ย 

However, Nischal Shetty immediately retorted with โ€œfacts about WazirX and Binanceโ€ and said that WazirX was indeed acquired by Binance as Zanmai Labs has a license from Binance to operate Indian Rupees (INR)- crypto pairs in WazirX.

Zhao Blames WazirX Founders of Deceptive Word Games

Blaming WazirX founders for playing โ€œdeception word gamesโ€ on Twitter, Zhao revealed that Binance asked for WazirX to transfer the system source code, deployment, and operations, as recently as February this year. โ€œThis was refused by WazirX,โ€ stated Zhao.ย 

Corroborating on this point, Shetty revealed that the Binance team wanted control of Zanmai [in February 2022]. He said, โ€œNaturally if Binance desires control of Zanmai, they can acquire shares.โ€

According to Binance, although WazirX transferred the domain control to Binance, it never received shared access to WazirX’s AWS account or any control over operations including user sign-up, KYC, trading, and initiating withdrawals.ย 

โ€œThis was never transferred, despite our requests. The deal was never closed,โ€ Zhao insisted, stating that WazirX’s founding team, Nischal Shetty and Siddharth Menon, kept the control in their hands.

To this, Shetty replied with the following points:ย 

  • โ€œBinance owns WazirX domain name
  • ย Binance has root access to AWS servers
  • ย Binance has all the Crypto assets
  • ย Binance has all the Crypto profitsโ€

Calling out โ€œincorrect reporting,โ€ Zhao pointed out that Binance only provides wallet services for WazirX as a tech solution. โ€œThere is also integration using off-chain tx to save on network fees,โ€ he said. However, he insisted that โ€œWazirX is responsible for all other aspects of the WazirX exchange, including user sign-up, KYC, trading and initiating withdrawals.โ€

Zhao Offers to Work with ED in Any Way Possible

Acknowledging the charges against WazirX, Zhao said, โ€œRecent allegations about the operation of WazirX and how the platform is managed by Zanmai Labs are of deep concern to Binance.โ€ He added, โ€œBinance collaborates with law enforcement agencies all around the world. We would be happy to work with ED in any way possible.โ€

โ€œWe would love to work with ED to fix these issues in WazirX,โ€ offered Zhao. He added, โ€œWazirX has been uncooperative with us and looks like uncooperative with ED as well.โ€ย 

However, Shetty assured that WazirX has been cooperating with ED.ย 

On the Flipside

  • Several Twitter users are complaining that they arenโ€™t able to withdraw from WazirX due to maintenance issues.ย 

Why You Should Care

Zhao has openly suggested that โ€œIf you have funds on WazirX, you should transfer it to Binance. Simple as that.โ€

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Akriti Seth

Akriti is a Zurich-based reporter, focused on the political, regulatory, and legislative developments around crypto. She is a business journalist with over six years of experience working as a correspondent for organizations like Channel NewsAsia and Bloomberg TV India. In that time, Akriti has covered news in the finance, pharma, and state sectors.

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