Enforcement Directorate Issues Notice To Leading Crypto Exchange WazirX

The Enforcement Directorate issued a show cause notice to WazirX for undertaking transactions worth over Rs 2,790 crore in alleged violation of the Foreign Exchange Management Act

The Enforcement Directorate (ED) on Friday said it has issued a show cause notice to the country's largest cryptocurrency exchange for undertaking transactions worth over Rs 2,790 crore in alleged violation of the Foreign Exchange Management Act (FEMA). Mumbai-headquartered WazirX is as a domestic crypto currency and bitcoin exchange start-up registered under the company name Zanmai Labs Pvt Ltd that was incorporated in December 2017. The notice issued by the central probe agency under various sections of the FEMA names the exchange (WazirX), the company and directors Nischal Shetty and Sameer Hanuman Mhatre. The exchange and its promoters denied any wrongdoing and said they are "in compliance with all applicable laws". The ED issued a statement saying that it stumbled upon the transactions of the exchange during an ongoing money-laundering probe into "Chinese-owned" illegal online betting applications. The show cause notice is for transactions worth Rs 2,790.74 crore, the ED said. Shetty, also the CEO of the exchange, took to Twitter and said WazirX was yet to receive any show cause notice from the ED as mentioned in media reports. "WazirX is in compliance with all applicable laws. 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 posted on his handle. He added: "We are able to trace all users on our platform with official identity information."