WazirX Slammed With Data Requests From Law Enforcements


The crypto exchange has received over 1023 requests from law enforcement agents in the October-March 2022 period. 

Report Reveals Surge In Data Request 

The India-based crypto exchange has revealed the information in its transparency report for the period between October 2021 and March 2022 that they have received over 1023 data requests related to criminal activities. The total count has tripled since the previous April-October 2021 period, as requests poured in from Indian as well as foreign law enforcement agents. The company has also reported that 952 of these requests came from Indian agencies, while 71 were from foreign entities. Compared to the 377 requests received in the April to October period last year, the total number has tripled. The report also revealed that the exchange ensured prompt responses for each and every one of these requests, thus offering full compliance to these enforcement agencies. Even though the mandated response time is 72 hours from the request, the exchange claimed to have responded to each request within 22 minutes. 

95% Crypto Frauds Based Outside Blockchain

The report also shone some light on the nature of these crypto-associated frauds, claiming that an overwhelming majority of these cases, around 95%, are based outside the blockchain ecosystem, as a majority of them are traditional money market scams. The report also broke down the different fraudulent approaches that were commonly employed, claiming that 40% of all crypto frauds are Ponzi schemes, 25% are phishing scams, another 25% are impersonation schemes, while identity thefts account for around 5%. 

Government Tightening Oversight

In the last year or so, the growing crypto market in India has made the government sit up and take notice. Not only has it worked wonders as a high return investment asset, but it is also drawn the attention of undesirable elements, who have exploited it to launch their fraudulent activities. So naturally, the government has driven up the oversight of crypto exchanges and put pressure on law enforcement agencies, as is apparent from the flurry of information requests. 

However, the government’s interference in the country’s crypto market could entirely nip it in the bud. As it is, the high 30% tax levied on crypto gains, as announced during Budget 2022, has made several investors seek shelter overseas. Even the 1% TDS for every crypto transaction could prove deadly for the market liquidity. In fact, ever since the financial year started, the industry has experienced a significant “crypto brain drain,” with as much as a 90% reduction in trading and many crypto platforms deciding to move abroad.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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