REGULATION

Reuters: Binance-owned Indian exchange WazirX frozen assets of $8.16 million

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Reuters: Binance-owned Indian exchange WazirX frozen assets of $8.16 million

Reuters reported that India's financial crime-fighting agency has frozen the Indian cryptocurrency exchange WazirX on Friday, which is invested by Binance and allows easy asset conversion between the two exchanges. The freeze is reportedly due to alleged violations of foreign exchange regulations, with 646.7 crore Indian rupees (approximately $8.16 million) being seized by the enforcement agency. Regulators stated that the exchange is suspected of being involved in the money laundering process of an instant loan app company, converting it into cryptocurrency on its platform.

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According to a report by Reuters, the Indian financial crime fighting agency has stated that they have frozen the Indian cryptocurrency exchange WazirX on Friday. The exchange is backed by Binance and allows for easy asset conversion between the two exchanges. The freeze is reportedly due to suspected violations of foreign exchange regulations, with 646.7 crore rupees (approximately $8.16 million) being seized by the enforcement agency. Regulators allege that the exchange was involved in money laundering processes for instant loan app companies, converting the funds into cryptocurrencies on their platform.

WazirX has been owned by Binance since 2019, and Indian enforcement agencies began investigating WazirX last year. In 2021, the agency began investigating money laundering cases related to illegal Chinese online gambling platforms, stating that 575 crore rupees were converted into cryptocurrencies through the Binance platform.

WazirX has not responded to these allegations.

The Indian government has been tightening regulations on cryptocurrencies, implementing a new crypto trading tax law after July 1st. In addition to the existing 30% capital gains tax, the controversial 1% origin tax has been introduced. The government now imposes a 1% tax on all buyers of cryptocurrencies trading over $126. Several cryptocurrency exchanges have seen a more than 50% decline in trading volume.

Although Reuters mentioned WazirX as being part of Binance, Binance's founder, Changpeng Zhao, has denied this, stating that the acquisition was not successful.