We are fully cooperating, says cryptocurrency exchange WazirX after ED action

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Hours after ED froze cryptocurrency exchange WazirX’s bank balances to the tune of Rs 64.67 crore, the firm said it was fully cooperating with the probe agency.

“We have been fully cooperating with the Enforcement Directorate(ED) for several days and have responded to all their queries fully and transparently,” said the Wazir X spokesperson.

However, the cryptocurrency exchange has refuted the ED allegations and said, “We do not agree with the allegations in the ED press release. We are evaluating our further plan of action.”

Also read: ED freezes Rs 64.7 crore in bank accounts of crypto exchange WazirX

The ED is carrying out a money laundering investigation against the cryptocurrency exchange.

On Friday, the ED conducted searches on the property owned by one of the directors of Zanmai Lab Private Limited, which owns the popular cryptocurrency exchange, WazirX.

The ED said, “Zanmai Labs Pvt Ltd, the company that owns WazirX Crypto Exchange, has created a web of agreements with, Crowdfire Inc. USA, Binance (Cayman Islands), Zettai Pte Ltd Singapore, to obscure the ownership of the cryptoexchange. Earlier, their managing director, Nischal Shetty, had claimed that WazirX is an Indian Exchange which controls all crypto-crypto and inr-crypto transactions and only has an IP and preferential agreement with Binance.”

“But now, Zanmai claims that they are involved in only inr-crypto transactions, and all the other transactions are done by Binance on WazirX. They are giving contradictory and ambiguous answers to evade oversight by Indian regulatory agencies,” the central agency observed during the investigation.

WazirX works from cloud-based software and all employees work from home. According to the ED, despite giving repeated opportunities, WazirX failed to give the crypto transactions of the suspect fintech APP companies and reveal the KYC of the wallets. Most of the transactions are not recorded on the blockchain also.

As per ED, WazirX informed that prior to July 2020, they did not even record the details of the bank account from which funds were coming into the exchange to purchase crypto assets.

Because of the non-cooperative stand of the Director of WazirX exchange, a search operation was conducted by ED under PMLA on August 3.

Meanwhile, the Founder and CEO of WazirX, said WazirX was acquired by Binance.

“Zanmai Labs is an Indian entity owned by me and my co-founders. Zanmai Labs has a license from Binance to operate INR-Crypto pairs in WazirX. Binance operates crypto to crypto pairs and processes crypto withdrawal.”

He said, “You can check this fact by going to the TOS of WazirX.” He also urged people not to Don’t confuse Zanmai with WazirX.

Sharing some vital facts, he said, “Binance owns the WazirX domain name and has root access to AWS servers. It has all the crypto assets and all the crypto profits.”

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