The Enforcement Directorate (ED) continued its crackdown on crypto companies, sending notifications to cipher exchange CoinSwitch and CoinDCX are also allegedly under the central agency’s radar. According to News18 sources, summonses have been sent to officials in both encryption companies. This comes a year after the investigation department pulled ZebPay out for violating foreign exchange law.
Notices were sent against CoinSwitch and other platforms by the ED regarding the alleged violation of the Foreign Exchange Management Act (FEMA), the above-mentioned sources told News18. The investigative agency is trying to ascertain whether these companies are violating FEMA laws and whether they have been involved in foreign exchange violations. However, CoinDCX said that no case has been filed against the platform.
After initial investigations, ED officials sent a summons for questioning to each of the cryptocurrency exchanges. The sources added that the Central Agency directed several questions to the two companies. In addition, several documents from cryptocurrency exchange companies were searched by the ED investigation team. The summons was sent by the Bengaluru branch of the investigation agency.
It is worth noting here that the news comes regarding information from CoinDCX founder Sumit Gupta, who joined the ED investigation earlier this year. The sources said that the emergency department extracted important information from Gupta at that time.
According to a statement carried by IANS, one crypto exchange said that “ED has sent notifications to major exchanges in India Find information and data about how the platforms work. As required, we have shared all necessary information to the satisfaction of the department and no subsequent action is pending at our end.”
“We receive inquiries from various government agencies. Our approach has always been a transparent one. Crypto is an early stage industry with a lot of potential and we are constantly communicating with all stakeholders,” a CoinSwitch spokesperson said, confirming that notices have been sent to them as well.
In June of last year, the managing editor asked crypto exchange WazirX to explain the alleged violation of provisions of the Foreign Exchange Management Act, on cryptocurrency trades worth Rs 2,790.74 crore.
“In the period under investigation, WazirX users via their pool account received incoming cryptocurrency worth Rs 880 crore from Binance accounts and transferred Rs 1,400 crore cryptocurrency to Binance accounts. None of these transactions are available on the blockchain for audit or investigation,” he claimed. CEO at the time.
WazirX allows a wide range of transactions with cryptocurrencies, including exchange into Indian rupees and vice versa; cryptocurrency exchange; And even transfer/receipt of cryptocurrencies held in their pooled accounts to wallets of other exchanges that can be held by foreigners in foreign locations.”