New Delhi: Days after freezing assets of WazirX, the Enforcement Directorate (ED) on Friday prohibited another crypto exchange from accessing its funds. The probe agency froze Vauld’s bank balance amounting to a whopping Rs 370 crore for alleged money laundering. This crypto exchange is also under the scanner of ED for accumulating proceeds of crime via investments by illegal Instant Loan Apps.
Prior to freezing assets of Vauld, the ED team put a freeze on the assets of country’s leading exchange WazirX. The sleuths conducted searches on one of the directors of Zanmai Labs, which owns the popular exchange WazirX and issued orders to freeze Rs 643.67 crore stashed in bank accounts.
The crackdown on crypto exchanges come in wake of the investigation that spills the beans on alleged nexus between crypto exchanges & fintech firms, backed by Chinese funds. According to reports, these fintech firms invested money in these cryptocurrency exchanges and got the money transferred abroad via wallets. ED estimate says that more than 1,000 crore money has been laundered through 10 crypto exchanges. It’s after the probe findings, that the agency has termed bank assets as ‘proceeds of crime’.
The ED probe established that these fintech firms acted in connivance with the crypto exchanges. They bought crypto coins for over Rs 100 crore and sent them to international wallets. Notably, most of these fintech firms are backed by Chinese funds/investors.
The exchanges are paying the price for not doing due diligence and not reporting about dubious transactions by these firms.
Meanwhile, global crypto exchange Binance has informed that it is closing chain fund transfers with WazirX.
These fintech firms, in collaboration with the NBFC companies, used their platform to disburse instant app based loans. And, the profits accumulated from this was routed outside the country via crypto coins.
