WazirX official logo
Courtesy: WazirX

WazirX is being investigated under the Foreign Exchange Management Act

WazirX is being investigated under the Foreign Exchange Management Act, 1999. The crypto exchange is owned by Binance and is India’s largest platform for buying and selling crypto. The authorities are going to find out whether WazirX embezzled more than $350 million (Rs 2,970 crores) via its platform.

The investigation

The authorities in India found out that nearly $350 million in assets were transferred to unknown wallets. That is the reason why the Binance-owned platform is under investigation. WazirX is also allegedly using Binance’s own wallet technology that is allowing it to hide transactions from being recorded on the blockchain. Now, that is something suspicious. I am not even sure if that is even possible. However, if it’s true, this will be a major setback for both WazirX and Binance.

This case also urged India’s finance minister, Pankaj Chaudhary, to say that there is a need for global collaboration on the regulation of crypto. If countries collab to enforce crypto laws, taxation and have proper standards, only then it will be possible for the authorities to prevent such things from happening.

WazirX is under investigation for money laundering
Source: WazirX

WazirX has been in these waters for long

Since the time it was bought by Binance in 2019, there have been many times when it was called out by Indian regulators. The exchange has long been facing issues over non-compliance with AML (Anti-money laundering laws). It was also under investigation last year around this time for making illegal cross-border transactions worth around $381.93 million.

India’s current crypto landscape

India is no longer crypto-positive or even neutral. Even projects like Polygon (MATIC) moved out of India, and so did the co-founders of WazirX, Nischal Shetty, and Siddharth Menon. The 30% tax they have introduced has already reduced the volume on exchanges to such a huge degree that it’s hard to say whether the platforms will survive.

A report suggests that trading volume on WazirX has fallen by 74% on a YoY basis, and 4 out of every 5 traders have reduced their activity due to the tax and 1% TDS.

What are your thoughts as WazirX is being investigated under the Foreign Exchange Management Act? And do you think that India will take a more positive approach toward crypto in the future? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.

Also Read: Bitcoin and Ethereum will be under commodity regulators, plans Senate.