Binance Denies Responsibility for $230M WazirX Hack

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Binance, the world’s largest cryptocurrency exchange, has denied responsibility for the recent hack of the Indian cryptocurrency exchange WazirX. This comes after WazirX made misleading statements regarding the nature of its relationship with the global exchange giant.

In the wake of the hack, WazirX suggested that Binance could be responsible for compensating affected users. WazirX cited claims that Binance had acquired and controlled the Indian exchange. However, Binance has firmly rejected these assertions.

WazirX Should Compensate its Users

In a blog post, Binance expressed disappointment with WazirX’s attempts to shift blame and clarified the nature of their association. Binance acknowledged providing wallet services to WazirX but denied any ownership or operational control over the exchange. The Indian exchange had implied that Binance’s involvement could make them liable for compensating users affected by the hack.

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Binance, however, stressed that security and fund management responsibilities lie squarely with WazirX. In its blog post, Binance urged WazirX to take responsibility for the security breach and compensate users who lost funds under their management. As investigations continue, all eyes are on WazirX to see how the exchange will address the issue. For now, WazirX has abandoned its hack remedial plans.

Binance Officially Terminated Relationship With WazirX

Last year, WazirX continued its verbal tug-of-war with Binance over its ownership. As a result, Binance declared that it would not provide wallet services for WazirX and its customers. The digital asset service provider mandated that WazirX withdraw all its funds from the exchange.

The feud began in 2022 when Nischal Shetty, the co-founder of WazirX, made a public announcement stating that Binance had acquired its trading platform. However, Changpeng Zhao, the ex-CEO of Binance, argued that his company “never completed” the acquisition deal. Hence, they were just partners and nothing more.

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Attempting to clarify their relationship, CZ said the exchange was only responsible for providing WazirX with wallet service and an off-chain transaction solution.

About WazirX $230M Hack

Recall that Ethereum’s WazirX Safe Multisig wallet faced a major attack in July. As reported by TheCoinRise, approximately $234.9 million worth of funds from the Safe Multisig wallet were transferred to a new address. Tornado Cash, a decentralized protocol that enables private transactions, funded each transaction.

Meanwhile, Polygon Labs CEO Mudit Gupta suggested that the nature of the hack suggests North Korean cybercriminals are the likely culprits. WazirX temporarily suspended withdrawals of both cryptocurrencies and Indian rupees on its platform. However, the incident sent shockwaves through the Indian crypto community. Many highlighted the need for strong security measures in protecting digital assets.

Not long after, the exchange launched a bounty program aimed at freezing and recovering stolen assets. Nishal Shetty also reached out to over 500 exchanges to block the addresses associated with the stolen funds.