Changpeng Zhao, the CEO of Binance, has denied claims that the crypto exchange acquired WazirX. This comes after the Indian authorities took action against the Mumbai-based platform as part of an AML probe.
The Indian crypto exchange was raided by India’s Enforcement Directorate. Authorities froze about $8.1 million in funds as part of an AML investigation. CZ tweeted that Binance does not own any equity in Zanmai Labs, which is the entity operating WazirX. He clarified that the 2019 announcement of Binance’s acquisition of WazirX – the transaction was never completed. CZ said Binance has never at any point owned any shares of Zanmai Labs.
The acquisition was announced in November 2019 in a deal reportedly valued at $10 million. Zhao had said the acquisition shows Binance’s commitment and dedication to the Indian people and strengthening of the blockchain ecosystem in India, as well as another step forward in achieving the freedom of money. Since then, CZ had referred to WazirX as a “Binance-owned” entity. But now, CZ in a series of tweets said Binance only provides wallet services for WazirX as a tech solution, and integration of off-chain transactions to save on network fees. He says WazirX is responsible for all other aspects of its operations, including user sign-up, KYC, trading, and initiating withdrawals.
Nischal Shetty, the co-founder of WazirX, claims the acquisition deal took place. He says Zanmai Labs is an Indian entity owned by him and his co-founders. It has a license from Binance to operate Indian rupee-crypto pairs on WazirX. Shetty added that Binance operates WazirX’s crypto-to-crypto pairs and processes crypto withdrawals. Binance also owns the WazirX domain name. It has access to WazirX’s AWS servers. However, CZ brushed off this saying that in February Binance requested the Indian exchange to transfer system source code, deployment, and operations, but WazirX denied it.
Zhao said that WazirX has been uncooperative and looks like uncooperative with the ED as well. He later confirmed that Binance does not have control over operations including user sign-in, KYC, trading, and initiating withdrawals.