WazirX, once hailed as the largest cryptocurrency exchange based in India is caught in a web of controversies. The recent raids conducted by the Indian Enforcement Directorate on its parent company, Zanmai labs have opened an unexpected can of worms. Raids were conducted on Friday on the WazirX director following which their bank assets worth Rs. 64.67 crores were frozen by the agency. Binance, probably in an effort to distance itself from any imminent revelations that the ED raids could bring forth has disowned WazirX.
In the year 2019, it was claimed that Binance had bought WazirX. Looks like the deal was never finalized, and neither Binance nor WazirX felt the need to clear the air about the deal for almost three years. The shocking revelation was only the prologue to the Twitter war that broke out between WazirX CEO Nischal Shetty and Binance CEO Chanpeng Zao.
The Tug Of War
The revelation by Binance CEO that the deal was never carried out raised the bar of suspicion over WazirX which is already under scrutiny. However, Nischal Shetty was not ready to be sangfroid. He went ahead to dispute the claims made by the Binance CEO on Twitter and soon it turned to a war of words between Zhao and Shetty, with neither ready to back out. Let us take a look at the tweets.
1/ FACTS about WazirX & Binance:
WazirX was acquired by Binance
Zanmai Labs is an India entity owned by me & my co-founders
Zanmai Labs has license frm Binance to operate INR-Crypto pairs in WazirX
Binance operates crypto to crypto pairs, processes crypto withdrawal…
Binance does NOT have control on operations including "user sign-up, KYC, trading and initiating withdrawals", as stated earlier. WazirX's founding team controls that. This was never transferred, despite our requests. The deal was never closed. No share xfers.
While Zhao insists that Binance does not have any “control over operations,” Shetty is only too sure about the lack of veracity of those claims. In the long Twitter thread, Shetty reminds the largest cryptocurrency exchange in the world to not “confuse Zanmai and WazirX.” However, the Binance CEO emphasizes the fact that it only provides wallet services to WazirX.
“Binance provides wallet services to WazirX. WazirX domain is transferred to our control. We were given a shared access to an AWS account. We could shut down WazirX. But we can’t, because…It hurts users.”
Soon enough Shetty countered the claims made by Zhao using his own statements. The WazirX CEO took Zhao’s statement “we could shut down WazirX” as an indication of Binance’s control over the exchange. Zhao was not in the mood to back out either. He lashed out at Shetty in a counter-tweet for “playing deception wording games.”
People playing deception wording games. We can shut down the domain. It just hurts users. We do NOT have control of the trading system. You just gave the AWS login, no source code, no deployment capability. You also retained access to the AWS account, source code, deploy, etc. https://t.co/Zpp6MYlHtp
As the war of words continued on Twitter, a Twitter user came up with a suggestion to put an end to the tug of war asking who made the majority of the fee money. The following was Shetty’s response,
“Good question. Binance charges all the fees of Crypto-Crypto trading, Crypto withdrawals. Zanmai India charges INR-Crypto trading fees, INR deposit/withdrawal fees(since it operates WazirX through license obtained from Binance.”
Let us flip through a few responses of Twitter users who were caught in the middle of this row.
Woah Woah! Lewd generalizations that nobody asked for. Somebody needs a lesson on political correctness.
Not to worry CZ, the world knows how the Indians are nothing more then scammers. They've always used technology to hurt others rather then help. They become your friendly neighborhood IT guy & then eventually hack all your systems. Never hire or trust an Indian, ever!
what kind of word game and sorcery is this? it's like two infant/cousins just annoying each other. you guys meet in person and solve the problem with ED both of you, for greater good and for users as well. don't break trust to users who are relying to your exchange @NischalShetty