The Enforcement Directorate (ED) conducted searches on one of the directors of Zanmai Labs Private Limited that owns the popular cryptocurrency exchange WazirX. It issued an order to freeze their bank balances of ₹64.67 crore. Currently, the ED is probing two cases involving cryptocurrency against WazirX under rules of the Foreign Exchange Management Act, 1999 (FEMA).
The ED says, “In one of the cases, investigation done so far has revealed that one Indian cryptocurrency exchange platform, Wazirx, operated by Zanmai Labs Private Limited in India was using the walled infrastructure of Cayman Island based exchange BINANCE. Further it has been found that all crypto transactions between these two exchanges were not even being recorded on the blockchains and were thus cloaked in mystery.”
In response to the Parliament, WazirX stated that the company had not been served with a money laundering notification. According to the minister, a Show Cause Notice (SCN) has been issued against WazirX under FEMA laws for permitting outside repatriation of crypto assets worth Rs. 2,790 crore to unknown wallets.