SUMMARY
Overall, the crypto exchange received 828 requests from law enforcement agencies during April-September 2022
Of all the queries received, 64 requests were from forreign LEAs such as United States Federal Bureau of Investigation (FBI), and Interpol
WazirX said it blocked over 700 accounts during the period, majority of them due to requests from users
Cryptocurrency exchange WazirX received 828 requests from law enforcement agencies (LEA) against a total of 10 Mn transactions on the platform during April-September 2022, it said in its transparency report for H1 FY23.
Of all the queries received, 64 requests were from foreign LEAs such as United States Federal Bureau of Investigation (FBI), and Interpol, while 764 requests were from Indian LEAs such as the National Investigation Agency (NIA), Enforcement Directorate (ED), among others.
“All of these requests pertained to matters where criminal proceedings, investigation, and inquiry were initiated against the accused persons, and information was sought from WazirX as to whether such accused had dealt in crypto through our platform,” it said.
Illegal fund transfer, crypto scams, cheating, and forgery were the most common types of crimes reported.
Maximum requests came from regulators and LEAs in Maharashtra. The charges were criminal in nature, with most of them being fraudulent transactions, scams, cheating, loan app frauds, among others.
On the other hand, West Bengal or the eastern region, recorded a large number of cases related to identity theft, money laundering, and funds misappropriation.
The exchange claimed that it maintained its record of 100% compliance rate for all the requests received from agencies.
The report also said that the crypto exchange blocked over 700 accounts in the April-September 2022 period. The majority of them were due to requests from users.
“We still have some way to go to prevent security risks in crypto. The level of awareness around crypto needs to extend to its ill uses too. Only then can mainstream adoption take place in an environment of trust. We will continue our efforts to educate Indians about crypto, and comply with regulators to ensure any form of fraud with virtual digital assets is tackled,” WaizirX CEO and founder Nischal Shetty said.
Over the past few months, some of the crypto players from the country’s burgeoning Web3 ecosystem have come under the ED radar as part of its various probes.
Major crypto exchanges, including WazirX, Binance, Coinswitch Kuber, CoinDCX, Vauld, Zebpay, BuyUCoin, Bitbns and Giottus, have been inquired by the ED under the Foreign Exchange Management Act (FEMA) or the Prevention of Money Laundering Act (PMLA).
It is pertinent to note that earlier this month, Web3 startups in India formed a new lobby group, consisting of WazirX, Hike, CoinSwitch Kuber, CoinDCX, Coinbase and Polygon, among others, as members. The new association, Bharat Web3 Association (BWA), was formed a few months after the Internet and Mobile Association of India (IAMAI) dismantled the Blockchain and Crypto Assets Council (BACC).
While the government has introduced tax on crypto transactions and income from crypto assets, there continues to be uncertainty around policy for the virtual assets in the country. While the government has not made its stance clear, the Reserve Bank of India (RBI) has been a staunch opponent of cryptocurrencies. The central bank has also launched central bank digital currency (CBDC) to counter the growth of private cryptocurrencies.
