ED Notice to WazirX🧵
1) During the period of ED investigation they observed:
1. Binance to WazirX Inflow: 880 Cr.
2. WazirX to Binance outflow: 1400 Cr.
1/
1) During the period of ED investigation they observed:
1. Binance to WazirX Inflow: 880 Cr.
2. WazirX to Binance outflow: 1400 Cr.
1/
2) Binance <> Wazirx transfers are not recorded on Blockchain:
All these inflows and outflows are not recorded on Blockchain for audit purposes which makes it less transparent.
They are done using API Keys as confirmed by Nischal in an interview conducted by Crypto Kanoon.
2/
All these inflows and outflows are not recorded on Blockchain for audit purposes which makes it less transparent.
They are done using API Keys as confirmed by Nischal in an interview conducted by Crypto Kanoon.
2/
3) Facilitation of the transfer from WazirX to other foreign exchange accounts which could be held by foreigners.
3/
3/
My personal take (not to be taken as a legal conclusion as I am not a legal advocate/expert)
No.1: WazirX is a subsidiary of Binance, all the accounts registered on WazirX are KYC verified. So, all the transfers from Binance to Wazrix can be mapped against an 🇮🇳 Citizen.
4/
No.1: WazirX is a subsidiary of Binance, all the accounts registered on WazirX are KYC verified. So, all the transfers from Binance to Wazrix can be mapped against an 🇮🇳 Citizen.
4/
No.2: Wazirx didn't use Blockchain for internal transfer i.e WazirX to Binance or Vice-Versa to save cost as they have zero transfer fees for internal transfer.
API keys made the process faster, cheaper. For security KYC was already in place.
5/
API keys made the process faster, cheaper. For security KYC was already in place.
5/
No.3: As far as AML, FEMA, Terrorist Financing charges are concerned. Indian exchanges by far follow the most stringent KYC in the world by taking Aadhar card, Pan Card, Mobile No of individuals.
Exchanges have already adopted "Banks Charter" in advance as guidelines.
6/
Exchanges have already adopted "Banks Charter" in advance as guidelines.
6/
No.4: There is no clear law that defines "cryptocurrencies" in the country. So are these considered as Currency, Digital Asset, Commodity, Utility token, Security token?
"Valuable" cryptocurrencies need to be defined well.
7/
"Valuable" cryptocurrencies need to be defined well.
7/
No.5: WazirX is a platform to facilitate buying and selling of various digital assets. It is a legitimate marketplace which they have been running for 3 years now.
They are also part of the self-regulatory code to eliminate bad actors.
8/
They are also part of the self-regulatory code to eliminate bad actors.
8/
No.6: I am personally seeing a lot of positivity in this particular event as at least investigative agencies and ministry will be forced to speed up regulations for avoiding any such confusion in the future.
HODL ON...
HODL ON...
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