The feud between Binance and Zanmai, the company behind WazirX, takes an interesting turn as Binance terminates the use of its wallet service for WazirX users.
Binance stated in a blog post, “You may be aware of the public debate between Binance and Zanmai, the entity operating the Indian crypto exchange WazirX, regarding the nature of our relationship.”
“There has been a lot of confusion, and as a WazirX user, you may be worried about your funds on WazirX – after all, it is your right to demand absolute clarity in a situation where your hard-earned money is involved,” it added.
On January 26, 2023, Binance offered Zanmai the choice to either retract the false statements it had made or stop using Binance wallet service.
Zanmai had until February 3, 2023, 23:59 UTC to withdraw the money from the accounts as they had refused to retract their misleading claims.
Binance is now working out arrangements with Zanmai to withdraw any remaining assets in the relevant accounts after 3 February. “However, the responsibility ultimately lies with the Zanmai team to make the withdrawals expeditiously,” Binance noted.
WazirX tweeted it’s working to withdraw the funds from Binance. It noted, “We have initiated the process of transferring assets to multi-sig wallets, which we expect to be fully completed within the next few hours.”
Last August, Binance CEO CZ announced it doesn’t own WazirX when the latter was being investigated by the Enforcement Directorate (ED) for money laundering. WazirX founder Nischal Shetty argued that Binance owns the WazirX domain name, has root access to the AWS servers, and has all the crypto access.
In the latest blog post, Binance clarifies that Binance provided Zanmai wallet services only as a tech solution for their operations of WazirX. Binance has never managed or controlled WazirX’s operations.
“Our provision of wallet services to Zanmai was not unique – it was similar to arrangements we have with numerous other firms that use our technology and infrastructure to independently run their businesses,” Binance asserted.
Binance says Zanmai should not be permitted to perpetuate false narratives on the basis of their use of Binance’s wallet services as they view such false claims as an attempt to shift the responsibility over WazirX’s operations to Binance.
Last month, WazirX published its Proof-of-Reserves (PoR) report with 90% of the total user assets stored in Binance wallets, and the remaining is stored in hot wallets. While the user assets may be on Binance wallets, WazirX has the API which gives them control of the tokens.
