Affected by vicious events such as FTX, the encryption industry is still in silence. Against this backdrop, Binance said in November last year that it would set up a $1 billion "Industry Recovery Fund", to help high-quality projects survive the liquidity crisis. Recently, the recovery fund has made new progress. Binance co-founder He Yi said at a meeting that the current recovery plan is advancing two relatively large transactions, targeting two transactions platform.

For a while, there were rumors everywhere, most of which speculated that the acquisition targets would be the Indian trading platform WazirX and the Indonesian trading platform TokoCrypto. According to Coingecko data, the WazirX platform token WRX rose by about 7.4% in a short period of time, and the TokoCrypto platform token rose by about 17.5% in a short period of time.

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WazirX: Big meme company, No. 1 in India?

Founded in 2018, WazirX bills itself as India’s largest crypto exchange with over 600,000 users (India’s population is 1.393 billion in 2021). According to Coinmarketcap data, WazirX ranks 108th in the spot market on the platform, and contract trading is not on the list.

Due to the overall downturn in the market and the supervision of the Indian authorities, the trading volume of WazirX has declined significantly. From January to November 2021, the exchange’s transaction volume reached US$43 billion, while in the same period in 2022, this figure was only US$10 billion, a drop of 76%.

On January 11th, WazirX just released its Proof of Reserves.According to the report, WazirX has reserves worth $286.1 million.About 92% of those assets ($259.65 million) were held in wallets, with $26.45 million held in other exchanges.

WazirX publicly stated that the total assets held by the company are more than WazirX user assets, and users do not need to worry about insufficient asset reserves. "We are not only the largest cryptocurrency exchange in India, but also the largest cryptocurrency exchange in India. .”

Still, this amount of reserves is far lower than that of mainstream exchanges.According to Nansen data, Binance has a net worth of more than $57 billion, OKX has $6.7 billion, and Crypto.com has $3.3 billion.

An interesting phenomenon is that the mainstream currency that is more preferred in the market is not the main reserve of WazirX, and the reserve certificate shows that,The asset with the largest reserve is 6.09 trillion SHIB, as high as 56.66 million US dollars, 1356 BTCs ranked second with 24.7 million US dollars, 19950 ETHs with 28 million US dollars, 303 million DOGEs with 24.21 million US dollars, and 16.53 million MATICs with 14.74 million US dollars.

The currency distribution of this asset reserve is different from other mainstream magnates.This rather interesting phenomenon may reflect user preferences in the Indian market to a certain extent.

The regulation of the Indian market also has a more obvious impact on the Institute.

In August last year, WazirX director Sameer Mhatre was raided by the Indian Law Enforcement Agency. WazirX actively facilitated the use of encryption to launder money by about 16 accused fintech companies, the agency said. As a result, authorities froze $8.1 million in funds held by WazirX.

In addition, India's Ministry of Finance also announced the same month that it was investigating two cases against WazirX under the Foreign Exchange Control Act, alleging that WazirX covered up illegal transactions.

As the protagonist of this acquisition rumor, Binance is not the first to contact WazirX.

For example, in the introduction of WazirX's official website, the company clearly stated that "WazirX is part of the Binance Group, the world's largest encryption exchange, providing services to users in 180 countries." The $50 million "India Blockchain Development Fund" was established.

But as early as August 2022, CZ explained the relationship between WazirX and Binance in a tweet.

“Binance does not hold equity in Zanmai Labs, which is the operating entity of WazirX. On Nov. 21, 2019, a blog post from Binance said it had “acquired” WazirX, a deal that was never completed. Binance never — at any time — owned any stake in Zanmai Labs, the entity that runs WazirX.”

Regarding the cooperation between the two, CZ clarified. "Binance only provides wallet services for WazirX as a technical solution.WazirX is responsible for all other aspects of the WazirX Exchange, including user registration, KYC, trading and withdrawals. The recent allegations regarding WazirX's operations and Zanmai Labs have raised serious concerns for Binance. Binance will cooperate with law enforcement agencies around the world, and we are happy to cooperate with law enforcement in any way possible. "

Prior to this, the Indian Enforcement Agency had stated that because various financial technology companies supported by Chinese capital failed to obtain regulatory approval in India, they turned to enter the Indian market through the encryption industry.

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Tokocrypto: Surviving in the cracks of religion

Tokocrypto was founded in June 2017 and is headquartered in Jakarta, Indonesia. In 2019, the company registered with the Indonesian Commodity Futures Trading Regulatory Authority, which is also the first regulated crypto trading platform in Indonesia. In August 2022, the Indonesian Commodity Futures Trading Regulatory Authority announced the suspension of the registration of cryptocurrency exchanges.

According to Coinmarketcap data, Tokocrypto ranks 98th on the spot on the platform.

In 2021, Tokocrypto CEO Pang Xue Kai said that the company plans to conduct an IPO within two to three years, but so far this action is still a new development with more disclosures.

In September 2022, Tokocrypto laid off 45 employees, approximately 20% of its workforce. In December, Bloomberg reported that the layoffs were continuing and that the company's CEO had been replaced.

In the same month, there was a lot of media coverage of Binance’s acquisition of Tokocrypto.But what is interesting is that, somewhat similar to WazirX, Binance’s acquisition of Tokocrypto also has multiple rhetoric.

On December 19, CZ posted a tweet explaining the situation. CZ said, “Binance has always been a major shareholder of the Tokocrypto exchange, and this time it just injected more funds and increased its stake.” Close to 100%."

In the past 2022, according to a study by DappRadar, although the market has entered a bear market, theIndonesia is considered to be the emerging crypto market with the second highest growth rate in the world. Ukraine, Indonesia, and Russia saw crypto adoption growth of 143.17%, 115.59%, and 88.28%, respectively. In terms of traffic, Indonesia rose from fifth to third, with a surge of 115.59%.

Despite the rapid growth of the Indonesian market, Indonesia is a different crypto market in terms of "style".

Indonesia is the country with the largest Muslim population in the world. The Muslim population is as high as 230 million, accounting for nearly 90% of its population and about 1/8 of the global Muslim population.Although the country is not an Islamic country, the influence of religion on the crypto market is still quite profound.

In 2021, experts from the Indonesian Federation of Islamic Clerics (Nahdlatul Ulama) held a hearing and believed that the use of cryptocurrencies may lead to various risks, which have affected the legality of transactions. According to the conclusions of the meeting, a fatwa (Fatwa) was issued, affirming that the use of cryptocurrencies such as Bitcoin violated Islamic law (Sharia) and defined it as a prohibited behavior (Haram). According to the Indonesian Council of Religious Leaders, Muslims are banned from using crypto assets. In addition, the National Ulema Council (MUI) also considers cryptocurrencies as off-limits.

From an optimistic perspective, regulatory authorities are more open to crypto assets.

In the third quarter of 2022, the Commodity Futures Trading Regulatory Authority will soon publish new rules on crypto regulation. In the fourth quarter, Indonesia’s finance minister stated that it plans to transfer the regulation and supervision of cryptocurrency investments to the Financial Services Authority (OJK) to better protect investors. Earlier this year, the head of the Commodity Futures Trading Regulatory Authority stated that “as part of broader financial industry reform, regulatory powers for crypto assets will be transferred to the FSA within the next two years, at which time exchanges should be established.”