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HomeNationalAttention! Such frauds are happening due to cryptocurrency, 2 lakh accounts...

Attention! Such frauds are happening due to cryptocurrency, 2 lakh accounts were blocked in the last 6 months, know the reason

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Transactions with cryptocurrency have become common now. Along with this, reports of many types of frauds and forgery are also coming. In view of these criminal incidents, big cryptocurrency exchanges have blocked more than 2 lakh crypto accounts in the last 6 months. These criminal offenses range from online fraud to tax evasion and many other serious crimes.

Between April-September 2021, three cryptocurrency exchanges WazirX, Coinswitch Kuber and CoinDCX have closed more than 2 lakh accounts for suspicious activity. Coinswitch Kuber has blocked 180,000 accounts in the last 6 months. In addition, the exchange is monitoring 200,000 accounts that may be suspicious. CoinSwitch Kuber’s CBO Sharan Nair has given this information to ‘Business Line’.

Complaints received from foreign agencies

WazirX has closed 14,469 crypto accounts. Inputs were received from Indian and foreign agencies regarding these accounts. Foreign legal agencies had sent 38 requests to WazirX related to the suspicious account. These countries include the US, UK, France, Austria, Switzerland and Germany. However, more than 90 percent of the accounts have been closed because suspicious activities were detected in other users of WazirX and the tracking system.

Why and how is fraud happening

Cryptocurrency fraud or criminal acts are happening because the regulators are not getting clear information about the transaction of bitcoin or other cryptocurrencies. It is being seen that people buy bitcoin from one platform and send it to an unknown address. Complete information about this address is not available. After buying bitcoin from an exchange, where and in which item it is being sent, it is not clear information about it.

Bitcoin transactions are not being tracked on these unknown addresses. Because of this, cases of fraud or tax evasion are increasing. Crypto accounts that show such activities are closed by crypto exchanges. Regulators are not able to know who is the address to which bitcoin is being sent, and what is its work. Even crypto exchanges are not able to track such transactions.

What WazirX said

WazirX founder Nischal Shetty says, WazirX is part of the Blockchain and Crypto Assets Council (BACC). There are other exchanges associated with this. Every transaction that happens on WazirX is traced and an identification system has been created for this. For this, the exchange has made a strict KYC rule, with the help of which the full account of transactions is kept even without any government regulator. If any suspicious activity is detected, it is detected through the blockchain. For this, WazirX has tied up with TRM Lab, which monitors cryptocurrency transactions.

Screening and risk management of the user’s wallet is done. The Enforcement Directorate (ED) had recently issued a show cause notice to WazirX which was sent under FEMA. In the notice, information has been sought about the transaction of cryptocurrency worth Rs 2,790 crore.

Lack of regulation on cryptocurrencies

To avoid such criminal activities, Coinswitch Kuber does not allow its users to withdraw or deposit funds in cryptocurrencies. Kuber’s rule is that if the user wants to withdraw money, then first the cryptocurrency will have to be sold on the exchange and that money will be received in Indian rupees which will be transferred to the bank account.

Policy experts believe that even though exchanges take various measures to check suspicious activities, the real problem is the absence of any regulation. There are no screws or any regulation in the world of crypto right now. In view of this, the Reserve Bank has refused to allow cryptocurrency. The government has also not been able to give any decision regarding this.

Read also: It is necessary to give PAN information in bank FD, otherwise there will be no refund of TDS deducted money


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