Binance Denies Involvement in $235M WazirX Crypto Hack

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

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

WazirX Hack Controversy

The controversy began when WazirX reported a hack targeting a multisig wallet that held user funds. The wallet, managed by five members of its team and one signatory from Liminal, a third-party custody provider, was compromised, resulting in the loss of millions of dollars worth of user assets.

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

Following the incident, WazirX faced several withdrawal requests it couldn’t fulfill. On August 27, 2024, Zettai Pte Ltd, an entity linked to the exchange, sought a moratorium in Singapore’s High Court to protect itself from creditors.

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

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

The statement explained that while Binance had provided wallet services to WazirX before January 2023, all funds were removed from its custody upon the latter’s request. From then on, WazirX and Liminal had full control over the funds, with no involvement from the world’s largest crypto exchange.

It also added that Binance had not yet received any reports from WazirX on the attack, although Liminal’s investigation reportedly found the breach originated outside its infrastructure.

Misleading Ownership Claims

The crypto firm stated that while a potential acquisition deal between the two had been contemplated in the past, it never went through, leaving the Mumbai-based exchange’s ownership and operations 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 it in user agreements were unauthorized and misleading. It claimed that despite repeated requests to remove those mentions, the Indian exchange continued to use Binance’s name, falsely implying an operational link.

The post concluded by urging the crypto community to stay informed and critically assess the “misleading” statements made by Mr. Shetty. “We trust users to be able to come to their own conclusions in light of these facts,” it read.