Binance urges WazirX to compensate users after $235M hack

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Binance, in an official statement released today, has denied responsibility for covering WazirX’s $235 million hack losses, rejecting claims of ownership or control over the exchange and urging its management to resolve the issue.

“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 that have been lost under Zanmai/Zettai management,” stated Binance.

Additionally, Binance emphasized that it has never owned or controlled WazirX, countering claims from the Indian exchange that Binance should compensate the affected users.

“Binance has not owned, controlled, or operated WazirX at any time, including before, during, or after the July 2024 attack. On the other hand, Zanmai, a company incorporated in India, is the entity that registered the WazirX platform with the Indian FIU in 2023, and is recognized by India’s Enforcement Directorate as the owner of WazirX,” said Binance.

Binance added that although a contract had been signed between the parties, the proposed transaction was never completed due to Zettai’s failure to perform its obligations.

In addition to contractual issues, after previously supporting WazirX with technical solutions, Binance confirmed that it no longer provides wallet services to the exchange following the incident.

“Binance does not provide and has never provided cryptocurrency-related services to WazirX users as described in the WazirX User Agreement. As we have said before, Binance had previously provided Zanmai wallet services as a tech solution for their operations of the WazirX exchange, as we do for many other third parties.”

Even though Binance tried to help the WazirX team, its efforts to verify the hack had gone unanswered. The report stated:

“We have requested the WazirX team to provide us with their reports on the incident including all internal reports as well as the purported report from Mandiant from August 14, 2024.”

Additionally, in 2019, Binance acquired certain assets and intellectual property of WazirX to launch multiple fiat-to-crypto gateways. However, as clarified in an update to the report in August 2022, this acquisition did not include any equity in Zanmai Labs, the entity operating WazirX. Consequently, WazirX continues to be managed and operated by Zanmai Labs, reinforcing Binance’s position that it does not own or control the exchange.

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