Enforcement Directorate Freezes Assets of Binance-Linked WazirX

Enforcement Directorate Freezes Assets of Binance-Linked WazirX

The Enforcement Directorate (ED) of India has frozen more than 77.6 bitcoins that were transferred to Binance from the Indian crypto exchange WazirX. The freeze is part of a money laundering investigation into a mobile gaming application.

Bitcoin Held at Crypto Exchange Binance Frozen by ED

The Enforcement Directorate (ED) of India announced on Wednesday that it has frozen 77.627,0139 bitcoins under the Prevention of Money Laundering Act (PMLA). The ED is the Law Enforcement and Economic Intelligence Agency of the
Government of India.

The freeze is part of the ED’s investigation into a mobile gaming application called E-Nuggets. As per the announcement, the bitcoin was transferred from Wazirx, a popular Indian exchange, to Binance. 

The law enforcement agency explained that "Aamir Khan, S/O Nesar Ahmed Khan, launched a mobile gaming application, namely E-Nuggets, which was designed to defraud [the] public," adding:

“After collecting a sizable amount of money from the public, the sudden withdrawal from the said app was stopped on one pretext or another. Thereafter, all data, including profile information, was wiped off of the said app servers.”

The ED explained that its investigations have revealed that the accused transferred part of the illegally earned funds overseas via the Indian crypto exchange Wazirx.

The accused allegedly opened a dummy account in the name of "Sima Naskar (Proprietor of M/s Pixal Design)" with Wazirx and used it to purchase cryptocurrencies. The ED further said:

"Thereafter, the said cryptocurrencies were transferred to another account on another crypto exchange, namely Binance."

"The balance of said transferred cryptocurrencies, i.e., 77.62710139 bitcoins [equivalent to USD 1,573,466 (Rs 12.83 crore)] at Binance Crypto Exchange has been frozen," the ED said.

Binance was believed to have acquired WazirX in 2019. However, Binance CEO Changpeng Zhao (CZ) recently said that the acquisition "was never completed," emphasizing that "Binance has never at any point owned any shares of Zanmai Labs, the entity operating Wazirx."

In August, the ED froze Wazirx's bank assets worth more than USD 8 million. However, earlier this month, Wazirx said that its bank accounts had been unfrozen. Following Wazirx, the ED froze crypto and bank assets worth USD 46 million at Vauld, a crypto platform backed by Peter Thiel. The agency searched the cryptocurrency exchange Coinswitch Kuber in August. However, the CEO of the exchange said that it was not related to money laundering investigations.