Now, this would not have been big news if not for the announcement of the acquisition that was heralded with much fanfare back in 2019 as the defining moment of India’s crypto and blockchain ambitions.<\/p>\n
CZ’s own previous tweets<\/a> on the subject post the acquisition, plus the integration touted within the Binance platform with WazirX, also made it a hard pill to swallow.<\/p>\n What turned this into a completely gargantuan affair was WazirX founder Nischal Shetty engaging with CZ in a public<\/a> spat, challenging that Binance did indeed own it. The crux of their to and fro had just one simple giveaway \u2013 both of them didn’t want to own WazirX.<\/p>\n The intent of this post is to try and provide an analytical scoop as to what is the underlying issue. We will also try and conclude who’s speaking the truth and who isn’t and also try and indulge in how this issue could have been avoided in the first place.<\/p>\n Interesting? Let’s go then!<\/p>\n A good starting point is to jot down what we know:<\/p>\n From a purely legal standpoint, the argument that Binance does not own any equity in Zanmai Labs & \/ or never fully acquired the business is legitimate. However, the devil is always in the details and there are some points to ponder:<\/p>\n The most interesting tweet is this from Shetty:<\/p>\n Notice the end. He says, \u201cDon’t confuse Zanmai and WazirX\u201d.<\/p>\n What if the acquisition was for the tech and not the Company?<\/p>\n This proves the point from Binance’s perspective that they never acquired any shares in Zanmai, but does not preclude the possibility that Binance acquired the technology, that is, the platform.<\/p>\n Why else would they have so much access to the technological aspects of the business?<\/p>\n If the above is true, Shetty is also telling the truth. Zanmai is simply the license holder to manage operations of the business in India that are not tech related.<\/p>\n As license holders, they cannot be held directly responsible for any errors they made as they are on account of their principal, that is, Binance. Binance can seek remedy for breach of duties but legally, Zanmai is just an agent.<\/p>\n Given the publicly available information & our own analysis, we can conjecture that the following transpired. Please be advised that this is solely our opinion of maybe how events unfolded & not a statement of facts.<\/p>\n Binance entered into an acquisition agreement for Zanmai Labs which, like any standard agreement, had certain conditions precedent to be considered executed.<\/p>\n Both parties, in good faith, began working on these conditions precedent which probably included:<\/p>\n At some point, the conditions precedent may have complied & the founders asked for the name of the Binance entity to which shares were to be transferred.<\/p>\n After all, Binance operates in regulated markets under its own name with its own on-ground presence, This, as Shetty challenges<\/a>, was never provided. We can only speculate what would be the reason, including but not limited to:<\/p>\n Volumes on centralized exchanges in India have taken a massive hit starting the 1st of July 2022 following the imposition of a 1% Tax to be paid by sellers<\/a> on the value of the sale.<\/p>\n As trading volume directly impacts exchanges’ earnings in the form of trading fees, market factors are aligned against the economics of operating centralized exchanges in India.<\/p>\n1. What We Know<\/b><\/h2>\n
![\"WazirX](\"https:\/\/i0.wp.com\/aayushbhaskar.com\/wp-content\/uploads\/2022\/08\/CZTweet-1.png?resize=800%2C480&ssl=1\")
<\/p>\n\n
2. So Who Owns WazirX?\u00a0<\/b><\/h2>\n
2.1. Some Psuedo – Legal Rhetorical Questions<\/h3>\n
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2.2. Everyone Is Telling The (Half) Truth<\/h3>\n
![\"\"](\"https:\/\/i0.wp.com\/aayushbhaskar.com\/wp-content\/uploads\/2022\/08\/NS_Tweet.png?resize=800%2C395&ssl=1\")
<\/p>\n![\"WazirX](\"https:\/\/i0.wp.com\/aayushbhaskar.com\/wp-content\/uploads\/2022\/08\/NS_Tweet_2.png?resize=800%2C328&ssl=1\")
<\/p>\n3. Not Our Facts But Our Opinion<\/b><\/h2>\n
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![\"\"](\"https:\/\/i0.wp.com\/aayushbhaskar.com\/wp-content\/uploads\/2022\/08\/The-binance-and-wazirx-controvery-explained.png?w=800&ssl=1\")
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