Following reports that the Enforcement Directorate had issued a show-cause notice to WazirX for alleged violations of the Foreign Exchange Management Act (FEMA guidelines in connection with transactions involving cryptocurrencies worth Rs2,790.74 crore, the crypto exchange assured clients that their funds were safe.
“The monies are safe with WazirX,” said Nischal Shetty, CEO of WazirX. “They don’t have to worry about the funds.”
WazirX, India’s largest cryptocurrency exchange, stated in a statement that it has yet to receive a show-cause letter from the Enforcement Directorate. WazirX has over five million members in India.
“WazirX is in compliance with all applicable laws. We go beyond our legal obligations by following Know Your Customer (KYC) and Anti Money Laundering (AML) processes and have always provided information to law enforcement authorities whenever required. We are able to trace all users on our platform with official identity information. Should we receive a formal communication or notice from the ED, we’ll fully cooperate in the investigation,” Shetty’s statement read.
WazirX, registered under a company called Zanmai Labs Pvt Ltd, was incorporated in December 2017 as a domestic cryptocurrency startup. It acts as a platform for trading in digital currencies such as Bitcoin, Ethereum, Tron, Ripple and Litecoin.
The ED has issued a statement saying that it stumbled upon the transactions of the company during an ongoing money laundering probe into the “Chinese-owned” illegal online betting applications.
“It was seen that the accused Chinese nationals had laundered proceeds of crime worth about Rs57 crore by converting Indian Rupee (INR) deposits into cryptocurrency tether (USDT) and then transferred it to Binance (exchange registered in Cayman Islands) Wallets based on instructions received from abroad,” it said
