Pushing crypto adoption is not easy: Binance CEO Changpeng Zhao

Changpeng Zhao, the CEO of crypto exchange Binance, has said pushing crypto adoption is not easy. “My job is to say the same thing in 1000 different ways, but I can only do about 3. Pushing crypto adoption is not easy,” he wrote on Twitter.

On August 8, Binance announced that it was ending off-chain financial transfers with WazirX, which is under investigation for sending cryptocurrency assets worth 2,790 crore to unidentified wallets.

Also Read: The connection between WazirX-Binance: A timeline of events as they unfolded

On August 5, the Enforcement Directorate (ED) announced that – as a part of an ongoing money laundering investigation against various fraudulent smartphone-based loan distribution apps “supported by” Chinese funds – it had frozen bank deposits of 64.67 crore made by WazirX.

“In order to provide clarity and protection for users, we are removing the off-chain fund transfer channel between WazirX and Binance,” Patrick Hillmann, Chief Communications Officer, Binance, said in a statement.

Also Read: Crypto, rupee withdrawals being processed normally, says WazirX after ED raids

Binance will no longer enable off-chain financial transfers between WazirX exchange and Binance using the “Login with Binance” option as of August 12, 2022, at 9 a.m. (India time)., the statement said.

Users will still be able to deposit and withdraw funds using the usual methods between Binance and WazirX, the company added. Off-chain transactions are those that happen apart from the bitcoin network’s blockchain.

Also Read: Cryptos appeal to not die despite volatile markets, macro risks, tax rules

The ED said it conducted raids against Sameer Mhatre, a director of Zanmai Lab Pvt Ltd, (which owns WazirX) on August 3 as he was not forthcoming with information being sought from him and was “non-cooperative”.

The federal agency in a statement said the exchange and its executives were “giving contradictory and ambiguous answers to evade oversight by Indian regulatory agencies”.

The agency said it found that a number of fintech companies involved in “predatory lending” through mobile apps in the country “diverted maximum amounts of funds to WazirX exchange and the crypto-assets so purchased have been diverted to unknown foreign wallets”.

Also Read: Crypto tax: Will investors get relief with 10,000 exemption in TDS?

It has come to notice that some users were given to believe that funds deposited in WazirX were managed by Binance, but this is not the case, the global crypto exchange said.

“Moving forward, Binance will support Indian regulators in the ongoing matters concerning WazirX. Binance believes in keeping an open dialogue with regulators, policymakers and the law enforcement community as we collectively seek to establish a global regulatory framework for the industry,” it said.

Minister of State for Finance Pankaj Chaudhary in a reply to Parliament said a show-cause notice has been issued under the provisions of FEMA against WazirX for allowing outward remittance of crypto assets worth 2,790 crore to unknown wallets.

Further, in another case, it is noticed that WazirX has allowed the foreign users’ request to convert one crypto into another on its own platform as well as by using transfer from third-party exchanges namely FTX, BINANCE, etc, he said.

(With PTI inputs)

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