Author

Topic: 90% of India's largest crypto exchange funds are in Binance wallet (Read 153 times)

legendary
Activity: 2856
Merit: 1420
WazirX has been acquired by Binance, so it is not surprising that their assets are held or managed by Binance.

That was everybody tought and then when shit hit the fan no one know anything about it:
https://techcrunch.com/2022/08/06/binance-says-it-doesnt-own-indian-exchange-wazirx-years-after-acquisition-announcement/
https://twitter.com/cz_binance/status/1555578415901802507

Quote
Quick thread on Binance and WazirX, and some incorrect reporting.
Binance does not own any equity in Zanmai Labs, the entity operating WazirX and established by the original founders.
~
Binance only provides wallet services for WazirX as a tech solution.

As for the coins it holds, FML!, two hundred thousand facepalms:


Really? Really? 1/5 of the coins on Wazirx are Shiba Inu?




Coindesk has an update on this. Binance is demanding that WazirX should retract all of their statements telling everyone that they are owned by Binance or have their service agreement terminated. The problem is however, WazirX will not retract their statement or erase any mentions of Binance in their terms of service.

It appears that the regulators will begin looking closely more into this. I reckon CZ and WazirX should have done this argument more privately.



But, this week, CoinDesk got WazirX’s proof as the disagreement was privately coming to a head.
In the early hours of Jan. 25 – in India, a national holiday – Binance sent WazirX a letter requiring the Indian exchange to meet two demands by the end of this month, or risk Binance terminating its service agreement with WazirX by Feb. 3.

First, Binance told WazirX to publish a pre-written “clarificatory statement” retracting WazirX co-founder Nischal Shetty’s previous statements that Binance owned WazirX. It also required WazirX to erase all mentions of Binance in its terms of service.

On Friday, Zanmai, WazirX’s official name, responded to Binance’s demands in a letter obtained by CoinDesk. It fought back, claiming that the demand letter was “unethical” and attempted to use “media pressure and threats to force Zanmai into issuing false and misleading statements as ‘clarifications.’”


Source https://www.coindesk.com/business/2023/01/27/wazirx-says-binance-lied-about-ownership-as-dispute-about-indias-largest-exchange-escalates/
hero member
Activity: 2800
Merit: 911
Have Fun )@@( Stay Safe
Before this public altercation with Nischal Shetty, the CEO of Wazirx and CZ the users were able to migrate their coins to Binance and vice versa and after this public stunt that option is removed from Binance and WazirX. Both Binance and Wazirx announced about their acquisition and it makes sense why majority of their funds were stored with Binance but now they claims that the acquisition never happened. Since this is a recent report about the funds, not sure what is going on.
sr. member
Activity: 994
Merit: 237
★Bitvest.io★ Play Plinko or Invest!

What the hell is going on?  Cheesy

If binance falls, there will be something like a Domino effect for sure! How come an exchange is custodian its funds in another one?

No doubt, all our funds should be in a personal cold storage, a hardware wallet is the best for most of us.

Of course we should use a hardware wallet through which we can safely store our accumulated cryptocurrency. If binance ever goes down, it will certainly have some impact on the entire cryptocurrency market. However, in some cases the price of Bitcoin may remain stable where people will find it convenient to trade and people will actually advance there.

My personal opinion is that all Bitcoin or cryptocurrency money should never be kept in one wallet, the money should be divided into many wallets whether it is small or large.
hero member
Activity: 1750
Merit: 870
Rollbit.com ⚔️Crypto Futures
Quote
WazirX had $285 million of total user assets, displayed in the form of stablecoin USDT, which is pegged to the U.S. dollar. Of the total user assets, around 92%, or $259.07 million, was held in Binance wallets, with $26.45 million being held in other exchanges.
Is this not a time bomb?? What happens to users who hold btc on the exchange and we have one volatile bull run from say $17k to $50k in a month... how will the exchange payout these portfolio gains when  its owners decide to takeout any profit gains Huh

Secondly, why the hell is an exchange transferring custody to another exchange, is this some kind of memorandum of understanding to be serviced by Binance, do their clients know what's going on?
hero member
Activity: 2268
Merit: 724
Bitcoin = Financial freedom
Binance owns Wazirx too so it's logical to see why 90% of their reserves are in Binance's wallet because it's like a parent company.

You aren't the only one who isn't surprised with this news. Because Binance owns WazirX, it is just logical or not surprising that its funds are kept in Binance blah blah blah. What? So it is now a sound business decision to put all your eggs in a single basket? So, when Binance's wallet is in trouble or compromised, everything else will also be in trouble? That doesn't so logical to me. After all, even if WazirX is owned by Binance, it is more or less operating independently.

If Binance wallet gets compromised then it will impact the whole crypto market prices where there is no doubt of that but looking from the company's perspective they keep their funds with them and they claim their funds are safe in their cold wallet even if they hack attempted against binance it didn't lose a huge part from their holdings and it has SAFU too so users trust in case of hack the users will be refunded the lost value but after all, "not your keys not your coins" makes sense all the time.
hero member
Activity: 2408
Merit: 516
WazirX is acquired by Binance since last year. Probably CZ wants to play safe in case India Government attack again the crypto exchange and froze there assets. There are reports before that this exchange bank account being frozen. India government is so persistent on taking down all business that involves crypto.

This is a bold move by CZ and it involves a lot of risk especially a panic by the public knowing there money is not really on the WazirX exchange.
I won't consider it the regular acquisition because Binance has always been with the project from launch and the reputation of the exchange was important in the launch of the project in India then when all laws was against cryptocurrency. The exchange exploit the population and the opportunity for P2P in India
legendary
Activity: 2506
Merit: 1823
🙏🏼Padayon...🙏
Binance owns Wazirx too so it's logical to see why 90% of their reserves are in Binance's wallet because it's like a parent company.

You aren't the only one who isn't surprised with this news. Because Binance owns WazirX, it is just logical or not surprising that its funds are kept in Binance blah blah blah. What? So it is now a sound business decision to put all your eggs in a single basket? So, when Binance's wallet is in trouble or compromised, everything else will also be in trouble? That doesn't so logical to me. After all, even if WazirX is owned by Binance, it is more or less operating independently.
hero member
Activity: 2856
Merit: 570
Leading Crypto Sports Betting & Casino Platform
I wasn't aware or can't remember that WazirX was already acquired Binance. And since they're under the wings of Binance then that's usually what it is after acquiring another business. I think what's surprising to me is that the 90% is just around $285M which I think isn't a lot for the largest crypto exchange there in India. But to be fair on this one, they've chosen the reserve to be in the form of USDT and not their native stable coin which is the BUSD.
hero member
Activity: 2268
Merit: 724
Bitcoin = Financial freedom
Binance owns Wazirx too so it's logical to see why 90% of their reserves are in Binance's wallet because it's like a parent company.

AFAIK, future of centralized exchange in India doesn't seem to be promising because the government implemented 30% tax rates last year which forced everyone to move to other trading mediums like p2p, and also the high-level staff of Wazirx also moved to Binance or something else so I don't really be surprised if many of Indian exchanges dust their bite this year or soon.
legendary
Activity: 3500
Merit: 6205
Farewell LEO, you *will* be missed.
If binance falls, there will be something like a Domino effect for sure!

I am actually surprised that people still need this kind of news to understand all these (bad) relationships.
Of course, people will prefer some rich exchange owners' posts on Twitter than the plain and simple "not your keys, not your coins".

Really? Really? 1/5 of the coins on Wazirx are Shiba Inu?

Welcome to the world of altcoins  Grin
..And yeah, if this is true then there are reasonable chances that WazirX could fall before Binance does.
legendary
Activity: 2828
Merit: 6108
Jambler.io
WazirX has been acquired by Binance, so it is not surprising that their assets are held or managed by Binance.

That was everybody tought and then when shit hit the fan no one know anything about it:
https://techcrunch.com/2022/08/06/binance-says-it-doesnt-own-indian-exchange-wazirx-years-after-acquisition-announcement/
https://twitter.com/cz_binance/status/1555578415901802507

Quote
Quick thread on Binance and WazirX, and some incorrect reporting.
Binance does not own any equity in Zanmai Labs, the entity operating WazirX and established by the original founders.
~
Binance only provides wallet services for WazirX as a tech solution.

As for the coins it holds, FML!, two hundred thousand facepalms:


Really? Really? 1/5 of the coins on Wazirx are Shiba Inu?



legendary
Activity: 1736
Merit: 1094
Assalamu Alekum
WazirX has been acquired by Binance, so it is not surprising that their assets are held or managed by Binance. Recently, CZ announced that they plan to hire more staff to prepare for market expansion in 2023 and 2024. Show their expansion and strength, while other exchanges like coinbase or houbi are cutting staff.
legendary
Activity: 2002
Merit: 1742
What the hell is going on?  Cheesy
I once saw one of the investors interviewing on one of the TV, i can't remember what day & the tv, the reporter discussed the collapse of FTX exchange and related to deposit assets and at the same time keeping the best and safest web assets.

Indeed from the interview, at first glance the investor suggested that with the current situation the choice of holding assets of Ledger & Trezor or Electrum was good, at the end of the conversation he said, if you are afraid of losing crypto assets, don't invest, internet attacks can happen unexpectedly, Ledger & Trezor or Electrum are no guarantee from attack or safe, sure anything can happen unexpectedly, then he said if you want to keep crypto assets / long-term investments, try to have your assets in well-known exchanges and the CEO is clear and responsible at the same time, if there was a hit and miss, then the reporter asked what exchange was good, he said maybe Binance, But Binance can happen unexpected things like FTX, all decisions are on ourselves, faith.

But I don't know who the investors are, India, Bangladesh, UK and other countries, maybe from the interview, some WazirX users trust Binance as one of their preferred exchanges to deposit crypto assets, it's just my guess, what I said is not 100% correct, maybe I'm wrong or maybe WazirX users are storing crypto assets on Binance of their own volition, or some other factor, which we don't know yet, maybe.
hero member
Activity: 728
Merit: 549
I mean it's already expected right? when a small companies get acquisitions by large company, the large companies has a right over the small companies money and asset too. Don't forget Wazirx isn't only a company get acquired by Binance, there's 9 companies e.g. Tokocrypto, Sakura exchange, Dapp Review, Coinmarketcap, Binance JEX, etc [1]. At least we know those projects are have relation with Binance, so there's nothing surprised if they're promoting Binance or fall if Binance bankrupt.

What the problem is we don't know is there any exchange or project that send almost of their funds to Binance and doesn't get published, the bad thing is if the whole exchanges trust in Binance, so when Binance bankrupt, the others will fall too.


[1] https://www.crunchbase.com/search/acquisitions/field/organizations/num_acquisitions/binance
hero member
Activity: 1330
Merit: 736
Top Crypto Casino
If binance falls, there will be something like a Domino effect for sure! How come an exchange is custodian its funds in another one?
Most probably, look how market become so affected on FTX incident. Binance as the leading platform here in crypto space with so many sub-company, partners and stake to other companies. Imagine if a hack with a large scale happened, or worst. lol
hero member
Activity: 2408
Merit: 516
What difference does it make if Wazrix has to put 90% of his coin in the parent exchange/wallet he deemed safe? When I realized how much effort Binance puts into maintaining the security of its wallet, I understood why they are so confident. It makes no sense for them to own another wallet if they spend so much on their current wallet. I just think Binance deserves recognition for its work in the space, such as low transaction fees, high liquidity, and security. There are so many attacks against him for what he provides
legendary
Activity: 1540
Merit: 1274
It's not the serious part of the story but that those assets estimated at about $285 million of total user assets are in the form of stablecoins (USDT,) and those coins can be frozen, reversed or removed with a single click.

Indian crypto exchange WazirX released its proof-of-reserves report, and with that disclosed that 90% of its user assets are held in Binance wallets.
CoinGabbar, a third-party platform that tracks crypto assets, released WazirX's proof of reserves. At the time of writing, WazirX had $285 million of total user assets, displayed in the form of stablecoin USDT, which is pegged to the U.S. dollar. Of the total user assets, around 92%, or $259.07 million, was held in Binance wallets, with $26.45 million being held in other exchanges.

In this case, the risks are double, if Binance falls, WazirX will enter into a domino effect, and if USDT Falls, they will have only $26.45 million which will make them goes to bankrupt.
So where did the depositors' money go?

I hope WazirX's reserve in Binance is not 99% in BNB and the other 1% in BUSD. LOL!
Its USDT Cheesy
legendary
Activity: 2506
Merit: 1823
🙏🏼Padayon...🙏
LOL!

This should be a wake up call to WazirX users. This should also be another wake up call to everybody else who is using centralized exchanges.

The custodian you particularly trust your money with has another custodian to take care of the same money. You entrust your funds to custodian A, but custodian A entrusts the money to custodian B which, in turn, entrusts the money to custodian C, and then to D, E, F, G, H, I, J, and so on until Z. LOL!

So many levels of trust. Not to mention that the money is not really in custody because they're actually risked somewhere else.

I hope WazirX's reserve in Binance is not 99% in BNB and the other 1% in BUSD. LOL!
copper member
Activity: 56
Merit: 8
✅KYC-FREE CRYPTO DEBIT CARDS💳

What the hell is going on?  Cheesy

If binance falls, there will be something like a Domino effect for sure! How come an exchange is custodian its funds in another one?

No doubt, all our funds should be in a personal cold storage, a hardware wallet is the best for most of us.

Binance owns WazirX and CoinMarketCap they also hold a stake in Forbes now.
If Binance falls, it would a nightmare for the crypto market. They also back BUSD on BSC on their own. Paxos doesn't issue any BUSD on BSC.
legendary
Activity: 2212
Merit: 5622
Non-custodial BTC Wallet
Quote
90% of WazirX's User Assets Are in Binance Wallets, According to Proof-of-Reserves Report
"We are not only India's largest crypto exchange by volume but also India’s largest crypto exchange by reserves," a WazirX blog post said.

Indian crypto exchange WazirX released its proof-of-reserves report, and with that disclosed that 90% of its user assets are held in Binance wallets.
CoinGabbar, a third-party platform that tracks crypto assets, released WazirX's proof of reserves. At the time of writing, WazirX had $285 million of total user assets, displayed in the form of stablecoin USDT, which is pegged to the U.S. dollar. Of the total user assets, around 92%, or $259.07 million, was held in Binance wallets, with $26.45 million being held in other exchanges.
"The total assets held by WazirX are greater than the assets held by WazirX on behalf of its users," a WazirX blog post said. "With this, we are not only India’s largest crypto exchange by volume but also India’s largest crypto Exchange by reserves."
"90% of user assets are held in wallets at Binance, and the balance of 10% is stored in hot and warm wallets," WazirX added.

https://www.coindesk.com/policy/2023/01/11/90-of-wazirxs-user-assets-are-in-binance-wallets-according-to-proof-of-reserves-report/

What the hell is going on?  Cheesy

If binance falls, there will be something like a Domino effect for sure! How come an exchange is custodian its funds in another one?

No doubt, all our funds should be in a personal cold storage, a hardware wallet is the best for most of us.
Jump to: