WazirX, a falling knife; Nobody wants to catch!
“WazirX was acquired by Binance. Zanmai Labs is an Indian entity owned by me & my co-founders. Zanmai Labs has a license from Binance to operate INR-Crypto pairs in WazirX. Binance operates crypto to crypto pairs, processes crypto withdrawal” This was the statement of Nischal Shetty, one of the founders of WazirX.
Here every one has a question why both parties are washing hands to officially take over the WazirX? To know that we have a story for you. Please have a look at that first.
In December 2020, Some suicides were committed because of the recovery agents. Hyderabad police started the investigation. The victims come from middle and lower-middle-class families. They needed some financial help. So, they took off from an online app which is in the business of lending microloans.
The lander charges the interset pretty high and the repayment cycle is around 50 to 60 days. The lenders strategically traped the victims and the result was they give up.
The case becomes more critical and the investigation was handed over to ED. In the investigation, ED found that 12 NBFCs are involved in the racket. The landers shake hands with these Chinese NBFCs who needs various ways of income from Indian customers. The alliance worked together in the strategy to target the victims.
At the time when an alliance was formed the RBI has some clue that this situation might be formed. So, at that time RBI issued a public interest warning that reminds everyone to stay away from these kinds of things and stay safe.
When the RBI releases the notice the lenders and NBFC got a spark that RBI might block such transactions. So, overnight they started cancelling the registration certificates which were used to run such money lending companies. It is the step which brings the ED to WazirX.
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WazirX is a popular cryptocurrency exchange that operates in India. It was founded in late 2017 and helps people to trade in crypto. The WazirX was so-called acquired by the global crypto exchange Binance. At that moment every one feels like Binance acquires the Indian WazirX. But at present both parties decline to accept that WazirX is owned by them.
Now back to the story. When ED reaches WazirX. ED needs some transaction history. The transaction is held by the NBFC and Landing companies. Because WazirX as a crypto exchange ties up with Binance converts the INR with crypto. And we all know when any currency which was converted to any crypto is impossible to track.
So, ED wants that transaction which was done by NBFCs and land companies. But the twist is that WazirX does not have the proper details. When a company deals in money they need to know the ins and out of the transaction. In simple terms, it is known as KYC: Know your customer. But some companies don’t do it properly and violate government rules. WazirX is one of them. Now Ed charged WazirX with violating KYC norms. If the company is found guilty the company draws itself into such big trouble.
Now you can easily understand why Binance and the WazirX founder Nischal it self washing their hands from WazirX. But one thing that is very trustable and profitable; was Stock market investing. You can get lots of benefits by opening a Demat account. You need to just click Here.