by Aditya Kalra
NEW DELHI (Reuters) – India’s top crypto app CoinSwitch is working with the national financial crime agency, whose agents have raided its offices this week to learn about its operations Its CEO told Reuters on Saturday about the model and user onboarding process.
The $1.9 billion CoinSwitch says it is the largest crypto company in India with more than 18 million registered users. The company is backed by Andreessen Horowitz, Tiger Global, and Coinbase (NASDAQ: COIN) Ventures.
Ashish Singhal, who spoke publicly about Thursday’s search for the first time, said his company was in contact with the Indian Bureau of Enforcement’s division in tech hub Bengaluru about the operation of its crypto platform.
“Most of their interactions with us are about knowing what CoinSwitch does,” Singhal said, adding that inquiries included the operation of the cryptocurrency exchange, how users are onboarded and about knowing you Details of customer specification.
The case involves alleged violations of India’s foreign exchange laws, a person familiar with the matter said. Agents asked about foreign investment, income and outflows to check compliance and seized financial documents, the sources said.
Singhal declined to specify the agency’s allegations, citing legal sensitivity.
The Bureau of Enforcement did not immediately respond to a request for comment.
The investigation into CoinSwitch comes amid increasing regulatory scrutiny of the Indian crypto industry.
In a separate case, the agency this month froze $8 million in assets of top virtual currency exchange WazirX, investigating its possible role in helping instant loan app companies turn criminal proceeds into its platform cryptocurrencies on.
WazirX contests the allegations.
The agency said it was conducting money-laundering investigations into several shadow banks and their fintech firms for possible violations of central bank norms and predatory lending practices.
CoinSwitch search “has nothing to do with money laundering,” Singhal said. He said the agency “has been engaging with us regarding the operation of our crypto platform and we are fully cooperating with them,” he said.
While there is no official data on the size of the Indian crypto market, CoinSwitch estimates the number of investors to be as high as million with a total holding of around $6 billion.
