Binance Demands WazirX Move Funds Amid Ongoing Dispute

Binance, one of the largest cryptocurrency exchanges in the world, has invited WazirX, the Indian crypto exchange operated by Zanmai Labs, to arrange for the withdrawal of any remaining assets held in Binance wallets.

The move, which was outlined in a blog post on Friday, is intended to alleviate concerns about the fate of customer funds if Binance and WazirX end their collaboration.

However, the invitation has only served to further escalate the ongoing fight between the two crypto exchanges.

The public spat between Binance and WazirX began in August 2022, when Binance CEO Changpeng Zhao (CZ) claimed that Binance does not own any shares in Zanmai Labs, the entity operating WazirX.

CZ’s comments were made just hours after India’s Enforcement Directorate raided the properties of WazirX co-founder Sammer Mhatre on suspicions of money laundering.

In the days that followed, CZ stirred panic among WazirX users by threatening to shut down the platform and advising them to transfer their funds to Binance.

WazirX co-founder Nischal Shetty refuted CZ’s claims and stated that WazirX was the technology that was sold to Binance.

Shetty stated that he had legal documents proving the sale but was unable to share them due to legal reasons.

In the months that followed, WazirX was forced to lay off 40% of its workers due to macroeconomic factors, harsh taxes, and the crypto contagion exacerbated by the FTX collapse.

With 90% of WazirX user assets held in Binance wallets, it was unclear what impact a decoupling of Binance and WazirX would have on the Indian crypto exchange.

Binance’s recent invitation to withdraw assets appears to have come in response to a threat by the exchange.

Binance had given Zanmai a choice between retracting false public statements and continuing to use its services, or terminating the use of its wallet service.

Since Zanmai refused to clarify its misleading statements, Binance gave the company until February 3, 2023, to remove the funds from the accounts used for WazirX’s operations.

In light of the deadline, Binance has made an exception to allow Zanmai to withdraw the assets from the relevant accounts. The exchange has stated that it is doing everything it can to facilitate the process.