Exchanges are exercising self-regulation to comply with the Government guidelines. They themselves are blocking the suspicious accounts flagged by law enforcement agencies.
India’s crypto exchanges have begun blocking trading accounts of suspicious individuals identified by the Government, according to an Economic Times (ET) article.
Self Regulation is Key
The law enforcement agencies have been directing the exchanges to crack down on money laundering.
It has manifested in the form of self-regulation by the exchanges since there are no laws governing the status of digital assets in the country.
Furthermore, not just Indian agencies, foreign investigators are also contacting the most well-known crypto exchanges of India
Binance owned WazirX, recently released the number of requests it received from government agencies in its ‘transparency report’.
From April to September this year, the exchange got a total of 377 requests from law enforcement agencies, out of which 38 requests were from foreign agencies.
As of now, WazirX has locked around 1500 accounts.
Overall, it has locked 14,469 accounts, most of which were locked after customers requested to close their accounts or stop the services or there were some other payment issues.
“Initiatives such as the transparency report add credibility to the ecosystem and make the crypto world look more appealing to outsiders,” Nischal Shetty, CEO and Founder, WazirX told ET. “We aim to look at the bigger goals like positive regulations and consider ourselves paving the way to it through innovative approaches.”
Coin Crunch India (CCI) asked other exchanges for their comments. This article will be updated with the comments, once CCI gets them.
Industry Stands with Government Guidelines
Regulators have regularly expressed their disapproval of crypto transactions. In response, exchanges have maintained that they have sophisticated mechanisms to check money laundering.
“In India, we are bringing our four years of robust policy with our technologies to make sure we build products and services which help in crypto adoption but at the same time minimise the risk of money laundering,” said Kumar Gaurav, Founder & CEO of Cashaa.
India is on track to bring some regulations as per many reports. Keeping money laundering in check will be paramount for this legislation. Crypto proponents always claim that every single transaction is recorded and can be verified on the blockchain. Moreover, the transactions on the blockchain are immutable or permanent.
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