Indian authorities have frozen the WazirX account.

An unidentified bank that is holding the Rs 64.67 crore belonging to WazirX has been asked to freeze the account by the Enforcement Directorate, one of India’s top financial regulatory bodies.

The account was reportedly frozen by the authorities due to an ongoing investigation into money-laundering operations by cryptocurrency exchanges and other private financial institutions.

The government said that preliminary findings indicated several domestic fintech lenders were blatantly breaking local regulations.

Fintech companies tried to launder these monies by diverting them to cryptocurrency exchanges; the bulk of these funds were routed to WazirX.

WazirX refused to cooperate.

The agency said that WazirX management were uncooperative while also disclosing that the company made inconsistent claims about its operations.

The exchange first claimed to be an Indian exchange that “controls all crypto-crypto and INR-crypto transactions and solely has an IP and preferential arrangement with Binance,” according to the regulator.

However, the exchange would subsequently claim that Binance handles all other transactions and that it only handles “INR-crypto trades.”

“WazirX operates from a Cloud-based program, and all workers work from home,” the regulator claims. WazirX repeatedly offered chances, but it never provided the cryptocurrency transactions of the questionable fintech APP firms or disclosed the KYC of the wallets. The majority of transactions are also not stored on the blockchain.

Sameer Mhatre, director of WazirX, particularly said in the ED that “despite having full remote access to WazirX’s database, he is refusing to provide the specifics of the transactions connected to the crypto assets, obtained from the proceeds of crime of an Instant lending app scam.”

Watcher Guru contacted WazirX for comment, but they did not react right away.

Regulators in India have recently expanded their scrutiny of the cryptocurrency market, citing the potential for economic instability.

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