After the paranoia and turmoil in the crypto industry caused by the FTX liquidity and bankruptcy scandal, major digital-asset service providers in the space began publicizing their reserve funds.
“We are not only India’s largest crypto exchange by volume but also India’s largest crypto exchange by reserves.”
WazirX used CoinGabbar, a third-party crypto asset tracking platform, to display its proof of reserves. According to the data WazirX has roughly $285 million in total user assets displayed in the Tether stablecoin (USDT), at the time of writing.
According to the statement, 90% of user assets on WazirX are held in Binance-based wallets, with the remaining 10% stored in both hot and cold storage wallets. This equals roughly $256.5 million and $28.5 million respectively.
The exchange said it chose Binance because of the “strict protocols and industry-leading technical measures” it uses to safeguard user funds on its platform. It also ensured users of a more than 1:1 ratio to protect user funds in case of liquidation.
Despite being India’s largest exchange, WazirX was previously in hot water with local authorities due to money laundering charges. Funds on the exchange were frozen for just over one month during the investigation.
It was during this time that Binance publicly distanced itself from the exchange via a tweet from the Binance founder Changpeng CZ Zhao, which said it has no ownership of the exchange.
Additionally, Binance sided with local authorities during the investigation period by removing off-chain fund transfers with WazirX.
Binance was the first exchange to announce its proof of reserve scheme post FTX turmoil, which then caused a domino of other exchanges to do the same.