How WazirX-Binance clash will hit users, other exchanges & More Latest News Here – Up Jobs

Binance, the world’s largest cryptocurrency exchange, continues to provide liquidity for crypto-to-crypto trades, as opposed to INR to crypto, on WazirX despite having shut down off-chain transfers, or those not registered on blockchains, between the two platforms, said a person close to WazirX.

The person, who did not wish to be named, said WazirX has not severed its “umbilical cord” with Binance and that its crypto wallets continue to be controlled by the foreign entity. “When someone places an order for cryptos, it has to be fulfilled by somebody. That’s called a liquidity bot and it’s (the bot) controlled by Binance,” the person said.

“Because the trading volume was very high (on WazirX), in the good days, it had enough liquidity from Indian buyers and sellers itself. But after TDS (1% tax deducted at source from July 1), everything went for a toss, because everyone has left (from all Indian exchanges) and only the core hodlers remain,” he said. Hodlers refers to people holding long-term positions in cryptocurrencies.

WazirX’s link to Binance is also the source of liquidity for exchanges such as CoinSwitch and CoinDCX, both of which use automated tools to draw liquidity from WazirX, among other platforms.

According to data from cryptocurrency researcher Crebaco Global, average daily trading volumes for Indian cryptocurrency exchanges WazirX and CoinDCX were $9,675,215 and $7,791,357, respectively, in June. For the first 14 days of July, daily average trading volume of WazirX fell 71% to $2,806,408, while for CoinDCX, it fell 77% to $1,820,059.

Binance, meanwhile, appears to be disengaging with WazirX. “I don’t think we’ll be looking to get more engaged with Zanmai Labs,” said Patrick Hillmann, chief communications officer at Binance, in an interview with TV channel CNBC on Wednesday.

An enforcement directorate probe last month has shed new light on the 2019 deal between Binance and WazirX. At the time, both firms had announced that Binance had acquired WazirX. However, in a series of tweets on 6 August, Changpeng Zhao, chief executive officer (CEO) of Binance, said that the “transaction was never completed” and Binance didn’t own any shares of Zanmai Labs, which runs WazirX.

Nischal Shetty, co-founder of WazirX, however, tweeted that Binance had, in fact, acquired WazirX and Zanmai was granted a licence to run INR-crypto trades on the platform.

WazirX and CoinDCX did not respond to requests for comment.

Even if Binance stops supporting WazirX, it is likely to affect only crypto-to-crypto traders. This includes trading one crypto token for another, instead of using fiat currencies.

“For crypto-crypto liquidity, Indian exchanges mostly connect to any of the international exchanges and draw liquidity,” said Vikram Subburaj, co-founder and CEO of Giottus Cryptocurrency Exchange.

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