India Unfreezes WazirX Accounts, Exchange Continues to Cooperate

WazirX, one of the biggest crypto trading platforms in India, has announced that India’s Federal Enforcement Directorate (ED) has unfrozen its account after a month.

Giving an update on its blog, WazirX said that ED has unfrozen the bank accounts of WazirX due to the active cooperation extended by the company and active Anti-money laundering (AML) checks that led to the blocking of suspicious accounts.

“The ED has unfrozen the bank accounts of WazirX. In cooperation with investigators, WazirX provided all necessary details & documents of the alleged accused companies that used the WazirX platform,” the company tweeted.

“WazirX is now in a position to continue its banking operations as usual,” the company stated, as it pointed out that after an in-depth internal investigation, it was found that most of the users whose information was sought by ED were already identified as suspicious by WazirX internally and were blocked in 2020-2021.

WazirX, owned and run by Zanmai Labs, clarified that it has no association with any of the alleged accused Fintech and Instant loan app entities which appear to be the subject of ED investigation, and is carrying out the KYC/AML checks despite having no legal obligation to do so.

WazirX further clarified that it has a no-tolerance policy towards any illegal activities using its platform and mandates users to use it for legal and bonafide purposes only.

“On WazirX, the users undertake to operate as per all the applicable laws,” according to the blog. “WazirX is like any other intermediary whose platform may have been misused.”

ED Froze WazirX Accounts For Violating Money Laundering Regulations Last Month

After launching an investigation on WazirX for allegedly violating money laundering regulations, the ED froze the company’s asset amount at Rs 646.70 crore ($8.16 million).

According to Indian officials, the investigation into the WazirX case had revealed that it was using the walled infrastructure of Cayman Island-based exchange Binance and that all crypto transactions between these two exchanges were not even being recorded on the blockchains and were thus cloaked in mystery.

Meanwhile, WazirX clarified on its blog that the ED has been conducting investigations of 16 fintech companies and Instant loan apps, and some of them have happened to use the WazirX platform.

The case against WazirX has been going on since June 2021.

On the Flipside

  • Though the ED has unfrozen WazirX’s accounts, the company is hardly out of the woods. While the investigation continues, the co-owners have moved to Dubai with their families.

Why You Should Care

WazirX, one of the biggest crypto trading platforms in India, has allegedly laundered $350 million. The company was also accused of being a part of a scandal involving the laundering of over $130 million, with India’s authorities holding it responsible for playing a key role in the India-China criminal ring.

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed to be financial legal or tax advice. Trading Forex, cryptocurrencies, and CFDs poses a considerable risk of loss

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Author

Akriti is a Zurich-based reporter, focused on the political, regulatory, and legislative developments around crypto. She is a business journalist with over six years of experience working as a correspondent for organizations like Channel NewsAsia and Bloomberg TV India. In that time, Akriti has covered news in the finance, pharma, and state sectors.