didn’t own a stake in WazirX’s parent entity Zanmai Labs, the founders of the two companies have been embroiled in a war of words, exchanging claims and counterclaims on Twitter.
WazirX founder Nischal Shetty said on Saturday that the deal his company struck involved Binance’s parent entity.
“After some media reports on Binance structure, we asked about it,” Shetty wrote in a tweet thread. “We were given an ambiguous answer that parent entity is under restructuring. It’s been many months, still waiting for Binance Parent entity… Can Binance name Parent entity?”
1/ Deal involved Binance Parent entityAfter some media reports on Binance structure, we asked about itWe were g… https://t.co/2DmPcCnt7v
— Nischal (Shardeum) ⚡️ (@NischalShetty) 1659791215000
He added that the transaction included the sale of WazirX technology.
“Same technology was then licensed to Zanmai by Binance for INR market. Post licensing: Binance operates crypto-crypto trading, crypto deposit/withdrawals. Zanmai operates INR-Crypto trading, INR deposit/withdrawal,” Shetty wrote on Saturday.
Discover the stories of your interest
2/ Original deal included sale of WazirX Technology (IP)Same Technology was then licensed to Zanmai by Binance fo… https://t.co/gAwyZHOz3N
— Nischal (Shardeum) ⚡️ (@NischalShetty) 1659791217000
Zanmai Labs is the Indian entity operating WazirX. In the Indian entity, 0.01% is held by Shetty, and 99.99% is owned by Singapore-registered Zettai Pte Ltd. Zettai’s ownership is split among Shetty, WazirX cofounder Siddharth Menon and Sameer Mhatre.
Zhao said users on WazirX should transfer their funds to Binance.
“We could disable WazirX wallets on a tech level, but we can’t/won’t do that,” he tweeted. “And as much debates as we are enduring, we can’t/won’t hurt users.”
If you have funds on WazirX, you should transfer it to Binance. Simple as that.We could disable WazirX wallets on… https://t.co/8mNGG1XqUQ
— CZ 🔶 Binance (@cz_binance) 1659734907000
Zhao also tweeted that Binance could shut down shut down WazirX if it wanted. “But we can’t, because it hurts users,” he wrote.
WazirX had more than 10 million registered users as of February.
“The WazirX founding team maintained control of the operations of the platform,” Zhao wrote. “We (Binance) were never given data or control of users, KYC, etc. We would love to work with ED to fix these issues in WazirX.”
The WazirX founding team maintained control of the operations of the platform. We (Binance) were never give data or… https://t.co/1yw5Fqm09o
— CZ 🔶 Binance (@cz_binance) 1659734011000
The souring of the relationship between WazirX and Binance comes on the back of the Enforcement Directorate (ED) saying on Friday that it had recently conducted searches at the premises of the directors of Zanmai Labs and
had issued an order to freeze its bank balance of Rs 64.67 crore.
According to the agency, WazirX had “actively” helped around 16 fintech companies–which are under investigation on charges of money laundering–to divert alleged proceeds of crime using the cryptocurrency route.
ET reported on July 6 that ED is seeking information from multiple crypto exchanges under the Foreign Exchange Management Act (Fema). The ED has also accused the exchange of having a complicated ownership structure.
“Recent allegations about WazirX’s operations and how the platform was being managed by Zanmai Labs were of ‘deep concern’ to Binance,” CZ said in a statement. He also tweeted that WazirX has been uncooperative with Binance and that it appears to be uncooperative with ED as well.