India to Introduce Measures Around Crypto This Year, Says Government Official

February 6, 2023 Bitcoin.com

Nothing Outlaws Crypto in India if Legal Procedures Are Followed, Says Government Official

January 21, 2023 Bitcoin.com

Indian Government Launching Crypto Awareness Campaign

January 4, 2023 Bitcoin.com

Indian Crypto Market Suffers Significantly — Experts Say Trading Volumes Unlikely to Recover Anytime Soon

December 27, 2022 Bitcoin.com

Indian Government Updates Parliament on Cryptocurrency Bill and Investigations of Crypto Exchanges

December 20, 2022 Bitcoin.com

Web3 to inject $1.1T in India’s GDP by 2032, following 37x growth since 2020

October 23, 2022 Coin Telegraph

<div>Web3 to inject .1T in India's GDP by 2032, following 37x growth since 2020</div>

Coin Telegraph

The explosive Web3 growth in the country is supported by several factors, including a large talent pool, a high adoption rate and product development for global markets.

The global Web3 boom is expected to add $1.1 trillion to the Indian economy over the next decade, supporting the investment-based momentum driven by over 450 in-house startups, including CoinDCX, Polygon and CoinSwitch.

A recent study from the National Association of Software and Service Companies (NASSCOM), an Indian non-governmental trade association and advocacy group, highlighted India’s position as a leading global player in the Web3 market owing to several factors spanning a large talent pool, high adoption rate and product development for international markets.

*Snapshot of India’s Web3 startup ecosystem in 2022. Source: NASSCOM*

The US-India Strategic Partnership Forum (USISPF) estimated that “Web3 can add $1.1 trillion of new economic value to the Indian GDP in the next 10 years.”

*Investments in Indian Web3 startups. Source: USISPF and NASSCOM*

Moreover, the study highlighted that investments in Indian Web3 startups mimicked crypto adoption by racking up a 37x growth over the last two years. The explosive Web3 growth in the country is further supported by an increasing talent pool, which makes India’s demand-supply gap the lowest when compared to the USA, China and UK.

In addition, India ranks first when it comes to reskilling in newer technologies, which is considered paramount in emerging technologies such as Web3 and blockchain.

*Global Web3 talent distribution. Source: OKX and NASSCOM*

The above graphic shows the global talent pool for Web3, showcasing the US and China overpowering India. However, the study estimates that India’s Web3 talent pool is expected to experience the fastest growth rate in the coming 1-2 years.

*Focus areas for Indian Web3 startups. Source: Zinnov CoNXT Research & Analysis*

The Indian Web3 ecosystem caters to a variety of real-world applications and roughly 60% of the local startups expanded their footprint outside India.

Indian e-commerce giant Flipkart recently launched a metaverse space — named Flipverse — for locals to try out and purchase merchandise from brands including Puma and Nivea.

Flipverse was developed in collaboration with Polygon-incubated organization eDAO and will support digital collectibles and be made available on Flipkart’s newly online shopping platform, FireDrops.

Indian authorities unfreeze millions in locked WazirX bank accounts

September 12, 2022 Coin Telegraph

AML

The Indian crypto exchange was under investigation by local authorities for money laundering allegations which caused a freeze on over $8.1 million in bank account funds.

The Enforcement Directorate of India (ED) unfroze the bank accounts of the Indian crypto exchange WazirX, according to a statement from the exchange released on Sept. 12.

WazirX says it has been cooperating with local authorities during their anti-money laundering (AML) investigation by providing all of the necessary documents and details requested. The investigation targeted 16 fintech companies and instant loan apps, some of which solicited services from the exchange.

The exchange, however, said it has a no-tolerance stance towards any illegal activities on the platform. Additionally, it said that most of the targeted users in the ED investigation had already been flagged as suspicious by WazirX and blocked in 2020-2021.

WazirX told Cointelegraph the case is still under investigation but funds have been unfrozen due to no suspicious activity found, with “no further comment as of now.”

Funds in WazirX bank accounts had been frozen since Aug. 5, when the ED initially announced the investigation. The locked funds amounted to over $8.1 million in total.

ED searches the Director of WazirX Crypto-Currency Exchange & freezes its Bank assets worth Rs 64.67 Crore for assisting accused Instant Loan APP Companies in laundering of fraud money via purchase & transfer of virtual crypto assets.
— ED (@dir_ed) August 5, 2022

The ED’s accusations against WazirX claimed it had processed $130 million in transfers of funds to wallets under investigation for illegal activities. In light of the accusations, Binance, which once tried to acquire the company in 2019, distanced itself from the exchange via a public statement from CZ on Twitter.

Prior to the recent activity, the exchange was under ED investigation in 2021 for money laundering charges related to illegal online gambling proceeds tied to Chinese entities.

This time around, the crackdown on crypto exchanges in the country did not stop with WazirX. On Aug. 12, the ED froze a total of $46.4 million in Yellow Tune’s bank balances and balances from crypto exchange Flipvolt. The allegations were also money laundering related, and the company was accused of being a shell for Chinese entities.

Authorities said the funds would remain unavailable until the exchange can account for the criminal proceeds that it transferred out of the country.

These investigations began to pile up after the Indian government announced crushing new crypto tax regulations, which came into effect earlier this year.

Indian Authorities Search Crypto Exchange Coinswitch Kuber — CEO Says It’s Not Related to Money Laundering

August 27, 2022 Bitcoin.com

Indian authorities freeze $8.1M in WazirX funds as part of AML investigation

August 5, 2022 Coin Telegraph

Indian authorities freeze .1M in WazirX funds as part of AML investigation

Coin Telegraph

The Directorate of Enforcement of India alleged that WazirX "actively assisted around 16 accused fintech companies in laundering the proceeds of crime using the crypto route."

India’s Directorate of Enforcement, or ED, has announced it froze roughly $8.1 million in funds and conducted a search connected to cryptocurrency exchange WazirX as part of an investigation into instant personal loan fraud.

In a Friday announcement, the Directorate of Enforcement alleged WazirX facilitated transactions by unnamed fintech firms “to purchase crypto assets and then launder them abroad” as part of a scheme involving Chinese-backed companies circumventing India’s licensing regulations. In its investigation, the ED said it ordered WazirX bank accounts containing 646.7 million Indian rupees — roughly $8.1 million at the time of publication — frozen and conducted a search connected to co-founder Sameer Mhatre.

According to the regulator, the investigation was still ongoing. However, the ED claimed the crypto exchange had “lax KYC norms” and “loose regulatory control” of transactions between WazirX and Binance, and did not record information needed to verify from where funds were coming to purchase crypto used in the alleged fraud.

“Despite giving repeated opportunities, WazirX failed to give the crypto transactions of the suspect fintech APP companies and reveal the KYC of the wallets,” said the ED, adding:

“WazirX is not able to give any account for the missing crypto assets. It has made no efforts to trace these crypto assets. By encouraging obscurity and having lax AML norms, it has actively assisted around 16 accused fintech companies in laundering the proceeds of crime using the crypto route.”

ED searches the Director of WazirX Crypto-Currency Exchange & freezes its Bank assets worth Rs 64.67 Crore for assisting accused Instant Loan APP Companies in laundering of fraud money via purchase & transfer of virtual crypto assets.
— ED (@dir_ed) August 5, 2022

In a Friday Twitter thread, Binance CEO Changpeng Zhao said the firm did "not own any equity in Zanmai Labs, the entity operating WazirX and established by the original founders." He added that "Binance only provides wallet services for WazirX as a tech solution," while WazirX was responsible for KYC and other operations on the exchange.

With the exodus of many crypto firms in China following a regulatory crackdown, many companies have reportedly turned to the markets in India. The ED reported that some fintech firms “backed by Chinese funds” had “piggybacked” on Indian companies with defunct non-banking financial company licences to offer lending services to residents.

The ED took similar action against WazirX in June 2021, ordering the crypto exchange to show cause related to transactions of a money-laundering investigation into illegal online betting applications involving Chinese nationals. WazirX director Nischal Shetty said at the time that the exchange went “beyond [its] legal obligations by following Know Your Customer (KYC) and Anti Money Laundering (AML) processes and have always provided information to law enforcement authorities whenever required.”

Cointelegraph reached out to WazirX, but did not receive a response at the time of publication.

India needs global collaboration to decide on crypto’s future, says finance minister

July 18, 2022 Coin Telegraph

Coin Telegraph

Indian finance minister reiterated RBI’s stance on the crypto market, claiming it’s driven by speculation.

Indian finance minister Nirmala Sitharaman has called for global collaboration on cryptocurrencies, assessing their pros and cons to form a common standard and taxonomy.

Addressing a question on cryptocurrency in the Lok Sabha, the lower house of the Indian parliament, Sitharaman said that the Indian central bank had advised the government to prohibit the use of cryptocurrencies as it poses a risk to financial stability. However, the government is looking for a global approach. She said:

"Any legislation for regulation or banning can be effective only after significant international collaboration on evaluation of the risks and benefits and evolution of common taxonomy and standards."

She also reiterated the Indian central bank’s stance on crypto’s value is based on speculation. She added that “the value of fiat currencies is anchored by monetary policy and their status as legal tender. However, the value of cryptocurrencies rests solely on the speculations and expectations of high returns that are not well anchored.”

Reserve Bank of India (RBI), the Indian central bank, has maintained an anti-crypto stance since 2013, issuing multiple advisories against investing in digital assets and even prohibiting banks from offering services to crypto firms in 2018. The banking ban was eventually overturned after a supreme court ruling in 2020.

While the Indian government is yet to decide whether to move ahead with a ban or regulate the nascent crypto sector, the government was relatively quick to propose and implement two crypto tax laws that have wreaked havoc on the budding crypto industry.

During the January parliamentary session, the finance minister announced a 30% tax on unrealized gains and a 1% tax deduction at the source (TDS). The laws were heavily inspired by the country's gambling and betting laws, resulting in an instant decline in trading volume across exchanges just weeks after the new 30% tax came into effect.

The trading volumes and trader interests plunged further after 1% TDS came into effect on July 1. Many thriving crypto unicorns hopeful of a positive regulatory approach have started shifting their bases to crypto-friendly legislation, such as Dubai and Singapore.

indian government