Binance denies involvement in $235 million WazirX crypto hack

In the wake of a July 2024 cyberattack that resulted in the loss of $235 million from WazirX users’ wallets, Binance has denied claims that it bears any responsibility for the breach.

In an official statement, it stressed that it neither owns nor operates the Indian platform and urged the team to take full responsibility for the attack.

WazirX Hacking Controversy

The controversy began when WazirX reported a hack targeting a multisig wallet containing user funds. The wallet, managed by five members of his team and a signatory from Liminal, an external custody provider, was compromised, resulting in the loss of millions of dollars in user assets.

Binance’s statement clarified that it had no operational role in the compromised wallet or security at the time of the breach.

After the incident, WazirX faced several takedown requests which it was unable to accommodate. On 27 August 2024, Zettai Pte Ltd, an entity linked to the exchange, applied for a moratorium in the High Court of Singapore to protect itself from creditors.

In court, founder Nischal Shetty revealed that the cyber attack had wiped out almost half of the platform’s digital assets and hinted that Binance could be partly responsible for the loss.

The world’s largest exchange has denied the claims and insists it has no involvement in the hack or the lost funds, accusing management of deflecting blame as users and creditors grow increasingly frustrated.

The statement explained that although Binance had provided wallet services to WazirX before January 2023, all funds were withdrawn from its custody at the latter’s request. From then on, WazirX and Liminal had full control of the funds, without the participation of the world’s largest crypto exchange.

He also added that Binance had not yet received any report from WazirX about the attack, although Liminal’s investigation found that the breach originated outside of its infrastructure.

Misleading ownership claims

The crypto firm stated that while a possible acquisition deal between the two had been contemplated in the past, it never happened, leaving ownership and operations of the Mumbai-based exchange in the hands of Zanmai, a local entity

Despite this, Shetty and his team allegedly misled customers by implying that Binance owned or controlled the platform.

The Cayman Islands-based company noted that WazirX’s references to user agreements were unauthorized and misleading. It claimed that despite repeated requests to remove these mentions, the Indian exchange continued to use the name Binance, falsely implying an operational link.

The post concluded by urging the crypto community to stay informed and critically evaluate the “misleading” statements made by Mr. Shetty. “We trust that users can reach their own conclusions in light of these facts,” it said.

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