WazirX founder and chief executive Nischal Shetty has said WazirX is in compliance with all applicable laws, and that it is yet to receive any show-cause notice from the Enforcement Directorate.
"We go beyond our legal obligations by following Know Your Customer (KYC) and Anti Money Laundering (AML) processes and have always provided information to law enforcement authorities whenever required," he tweeted.
1/3— Nischal (WazirX) ⚡️ (@NischalShetty) June 11, 2021
WazirX is yet to receive any show cause notice from the Enforcement Directorate as mentioned in today's media reports.
WazirX is in compliance with all applicable laws.
The founder of India's biggest crypto exchange said the company can trace all users on its platform with official identity information. "Should we receive a formal communication or notice from the ED, we'll fully cooperate in the investigation," he said.
The enforcement directorate has launched a money-laundering investigation against the Mumbai-based crypto exchange for violating the FEMA rules, 1999 for transactions involving cryptocurrencies worth Rs 2,790.74 crore.
According to ED, users of WazirX have received cryptocurrency worth Rs 880 crore via its pool account from Binance accounts and transferred out cryptocurrency worth Rs 1,400 crore to Binance accounts during the period under investigation. Global crypto exchange Binance had acquired WazirX in 2019.
The ED is also probing money laundering by Chinese nationals who allegedly laundered Rs 57 crore by converting money into digital currency Tether (USDT) and further to Binance accounts.
The ED has alleged that none of the above-said transactions is available on the blockchain for any audit or investigation.
WazirX, which claims to have 2 million users on its platform, allows a range of transitions, including exchange of cryptocurrency with rupees and vice-versa, person-to-person transactions, and transfer to crypt held in its pool accounts to wallets of other exchanges. These wallets can be held by foreigners in foreign locations.