Binance just made a move into India’s potentially huge, although troubled, crypto market through the acquisition of the WazirX exchange platform.
Binance is the top cryptocurrency exchange by trading volume and it announced the news a blog post on Thursday, but it did not provide details of the deal. However, there are sources of the Economic Times estimated the firm was bought out for $5 million – $10 million.
The entry of the company into India might at first glance seem surprising, with the local crypto having been greatly distrupted by a ban on banking services for crypto firms instigated by the nation’s central bank in April 2018. Since then a number of local exchanges, including Koinex and Zebpay, have been forced to close, with the remainder moving to survive on crypto-to-crypto trading, and avoiding the fiat system.
That’s a strategy employed by WazirX, which launched earlier this year offering crypto-to-crypto and peer-to-peer trades, says the Economic Times.
However, Binance has a way round the banking issue, having launched Indian rupees on its Binance Fiat Gateway in recent weeks. Now it says users of WazirX will soon be able to buy the tether (USDT) stablecoin with rupees via WazirX and use USDT to trade any cryptocurrency offered by BInance.com.
“The acquisition of WazirX shows our commitment and dedication to the Indian people and strengthen the blockchain ecosystem in India as well as another step forward in achieving the freedom of money,” said Binance CEO Changpeng “CZ ” Zhao.
There is also another potential hurdle for Binance in India, with a government panel said to be mulling legislation that would ban cryptos completely in the country. It would seem that Binance considers that a risk worth taking and, if the estimated acquisition price is in the right region, it’s likely a small amount for the firm to pay to have a foothold as one of few fiat-to-crypto exchanges in the potentially huge market.
“Building fiat-to-crypto bridges remain a key mission for Binance, and WazirX will help this by providing a simple and cohesive way to purchase cryptocurrencies in a country which is home to more than a billion people,” said Binance CFO Wei Zhou.