The move provides Binance with a foothold in a region with great potential for crypto and crypto-enabled services. Various reports have quoted the acquisition price as being between $5 million and $10 million. The integration of their technology stacks is expected to be completed by the first quarter of 2020.
“The young demographic in India gives an edge to adopt and build on new financial technologies, and I believe this will play a vital role in making India a global blockchain innovation center to also spur cryptocurrency adoption throughout the larger public in the country," Binance CEO Changpeng Zhao (CZ) told the Economic Times, a leading Indian publication.
Launched in 2018, WazirX has 80 tokens listed on its platform. The acquisition supplies Binance with a fiat onramp for the Indian rupee, meaning the exchange can now accept purchases of cryptocurrencies made using Indian rupees.
The Malta-based exchange has been busy adding support for various currencies throughout the globe in a bid to expand the scope of its operations and popularize crypto. Zhao told the Economic Times that India was the first such foray. “One of the main goals is to add more fiat currencies to Binance and work with local partners to add as many fiat-to-crypto pairs as possible,” he said. Binance has also held initial coin offerings (ICOs) for projects based in India on its Launchpad platform and invested in the seed round offering for a protocol.
For WazirX, its purchase represents a fresh infusion of capital to expand the ambit of its operations. The Mumbai-based startup claims to have built the world’s first peer-to-peer (P2P) auto-matching technology. Nischal Shetty, a co-founder of the startup, told the Economic Times that the company intends to expand its P2P business geographically after the acquisition.
India and Crypto
The success of Binance’s acquisition depends on the regulatory climate for crypto in the South Asian country.
India does not have the heft and volume of crypto trading for other countries in Asia, but the numbers for people using and trading crypto has been increasing steadily. The upward tick has occurred despite a hostile regulatory environment for cryptocurrencies.
The country’s central bank has barred banks from conducting transactions with crypto exchanges. The Indian government is also considering legislation to ban cryptocurrency use altogether. Shetty from WazirX has said that he expects Binance to help the startup deal with regulators.