Under the Foreign Exchange Management Act (FEMA) 1999, the Enforcement Directorate (ED) issued a show-cause notice to cryptocurrency exchange WazirX and its directors Nischal Shetty and Sameer Mhatre on June 11 for transactions involving cryptocurrencies valued Rs 2,790.74 crore.
ED initiated the FEMA investigation on the basis of an ongoing money laundering probe into Chinese-owned "illegal" online betting applications, the agency said in a statement.
The platform allows for cryptocurrency transactions such as the exchange of digital currencies for Indian rupees and vice versa; cryptocurrency exchange; person-to-person transactions; and the transfer or receipt of cryptocurrencies held in its pool accounts to wallets of other exchanges, which, according to the ED, could be held by foreigners overseas.
