Crypto exchange Vauld has become the latest target as India‘s Enforcement Directorate or ED froze assets worth Rs 370 crore [$46 million] on 11 August. The move comes at a time when the Singapore-based startup filed for bankruptcy after citing “financial difficulties”, a month ago.
In a statement to TronWeekly, Vauld said,
“We are still expecting more clarity on the same. We’ll keep you updated as soon as we have additional details.”
Meanwhile, India’s top enforcement agency has launched a nationwide investigation, cracking whips on a number of homegrown Non-Banking Financial Company [NBFC] firms and their fintech associates alleging “predatory lending practices” in violation of the RBI guidelines.
This development comes after ED froze nearly $8 million worth of bank assets belonging to cryptocurrency exchange WazirX’s director Sameer Mhatre in connection with a money laundering investigation.
ED also conducted raids on one of the directors of Zanmai Labs Pvt Ltd, which owns the cryptocurrency platform.
On August 9, Zanmai Lab released a statement, “WazirX is a platform co-operated by Zanmai Labs Pvt. Ltd. (Zanmai Labs) and Binance. Zanmai Labs has a no-tolerance policy towards any illegal activities using WazirX.”
Vauld And How Many To Go…?
In response, Binance chose to dissociate itself from the Indian exchange. CEO Changpeng Zhao denied owing a stake in WazirX’s parent entity Zanmai Labs.
“Binance does NOT have control over operations including “user sign-up, KYC, trading and initiating withdrawals”, as stated earlier. WazirX’s founding team controls that. This was never transferred, despite our requests. The deal was never closed. No share xfers,” Zhao stated on Twitter.
It also disabled “off-chain fund transfers” between the two platforms from August 8. Off-chain transfers are among the key issues cited by the probing agency in the money-laundering case, sources familiar with the matter disclosed.
The uncertainty over the ownership and probe by ED has triggered panic among investors who are left with no choice but to seek out other platforms.
As a result, WazirX’s trading volume witnessed a sharp 50% decline on its platform, while its native token WRX plummeted from ₹23 per coin earlier this month to ₹17 on 10 Aug.
That said, after ED froze a bankrupt Vauld’s assets, one wonders who would be the next in line of fire.
