WazirX NFT platform was non-custodial, users were in control of assets: WazirX’s Nischal Shetty
Shetty clarified that there had been “some confusion” around the listing of NFTs from the WazirX marketplace on other platforms such as OpenSea, but that has been resolved.
Indian cryptocurrency exchange WazirX’s now-defunct Non-Fungible Token (NFT) marketplace never had any custody or control over users’ NFTs, co-founder and CEO Nischal Shetty said. His clarification came a month after a group of users wrote to him citing technical issues with listing and accessing their NFTs.
Shetty said the confusion had arisen between the marketplace and another NFT marketplace, OpenSea, which was supposed to allow WazirX’s users to access and trade NFTs after the latter’s NFT platform was shut down.
Shetty said the issue has now been resolved, likely offering relief to users.
WazirX, the largest crypto exchange in the country, shut down operations of its NFT marketplace on February 22, 2023, less than two years after its launch, as the platform failed to gain traction.
The situation worsened with high volatility, taxes and regulatory uncertainties affecting the virtual digital assets (VDA) space.
In the months following the shutdown, a group of users saw problems accessing their NFTs. They asked WazirX to transfer ownership of their NFT contracts to the wallet of their community-run Decentralized Autonomous Organization (DAO), according to media reports.
Around 18,275 NFTs were stuck in the escrow contract, causing the tokens to lose their value and credibility, the group claimed. The closure of the marketplace occurred without notice or prior information to the collecting community.
“The WazirX NFT platform was a non-custodial platform, which means you are always in control of your assets, unlike a centralized exchange where the exchange holds custody of your assets. I’m not sure where the issue of not having access comes from, because the platform never took custody of the asset, Shetty said Money control.
He added, “There was some confusion about how to get it (NFT) listed on other platforms and stuff. And the other platforms also had some of their own internal confusion about listing them, which was resolved later. So now if you have your NFTs on the WazirX platform, you can also have it on OpenSea and other places. They’re resolved now. And I think the community is happy about that.”
Shetty believes there was dissatisfaction among users who loved the platform and thought it was an attempt at innovation. It was also the first marketplace from India launched in 2021, aiming to facilitate the exchange of digital assets and intellectual properties such as artworks, audio files, videos, even tweets, in addition to other digital goods and services. These were minted on the Binance Smart Chain.
“Unfortunately, with the market conditions and the kind of response we got, the platform really dried up in the last few months, which led to the closure of the platform,” Shetty said.
When the site was shut down in February, WazirX had said that in the 30 days before it, the platform had only 71 unique active wallets, 354 transactions, a volume of around $112.24 and the total platform fee it collected was around $6 while server expenses ran into thousands of dollars.
According to WazirX, all tokens minted on the platform were held in decentralized wallets that allow users to trade and access their NFTs on any other platform running on Binance’s blockchain network.
Additionally, when multiple creators use a single smart contract to create NFTs, which will save gas fees, this becomes a shared smart contract. This will help them automatically list on OpenSea, which calls it a shared storefront.
Shetty left overseeing the day-to-day operations of WazirX earlier in 2022, and continues to be involved at a strategic level. Last year he moved base to Dubai and started working on his new L1 blockchain project Shardeum, which will go live later this year.
