Promoting the adoption of cryptocurrencies is not simple, according to Binance CEO Changpeng Zhao. “I have to say the same thing a thousand different ways, but I can only manage about three at a time,” It’s difficult to promote cryptocurrency adoption, he said on Twitter.
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Binance announced on August 8 that it was ceasing off-chain financial transfers with WazirX, which is being investigated for sending cryptocurrency assets worth 2,790 crores to unidentified wallets. WazirX is the subject of the investigation.
On August 5, the Enforcement Directorate (ED) declared that it had frozen bank deposits totaling 64.67 crores made by WazirX as part of an ongoing money laundering investigation into several fraudulent smartphone-based loan distribution apps “supported by” Chinese funds.
According to a statement from Patrick Hillmann, Chief Communications Officer at Binance, “we are removing the off-chain fund transfer channel between WazirX and Binance in order to provide clarity and protection for users.”
As of August 12, 2022, at 9 a.m. (India time), Binance will no longer support off-chain financial transfers between WazirX exchange and Binance using the “Login with Binance” option, according to a statement.
Users will still be able to transfer money between Binance and WazirX using the standard methods, the company said. Off-chain transactions are those that take place outside of the blockchain of the bitcoin network.
The ED claimed that Sameer Mhatre, a director of Zanmai Lab Pvt Ltd, which owns WazirX, was the target of raids on August 3 because he was “non-cooperative” and withholding information.
The exchange and its executives, according to the federal agency, were “giving contradictory and ambiguous answers to evade oversight by Indian regulatory agencies,” it said in a statement.
The organization claimed to have discovered that several fintech firms engaged in “predatory lending” through mobile apps in the nation “diverted maximum amounts of funds to WazirX exchange and the crypto-assets so purchased have been diverted to unknown foreign wallets.”
The world’s largest cryptocurrency exchange noted that some users were led to believe that funds deposited in WazirX were managed by Binance, but this was not the case.
“Binance will continue to assist Indian regulators in their ongoing investigations involving WazirX. As we work together to create a global regulatory framework for the industry, Binance believes in maintaining an open dialogue with lawmakers, regulators, and the law enforcement community “It read.
A show-cause notice has been issued under the FEMA provisions against WazirX for allowing outward remittance of cryptocurrency assets worth $2,790 crore to unidentified wallets, according to the Minister of State for Finance Pankaj Chaudhary in a response to Parliament.
In a different instance, it has been observed that WazirX has granted foreign users’ requests to exchange one cryptocurrency for another on its own platform as well as through transfers from outside exchanges like FTX, BINANCE, and others, he said.
