Law enforcement directorate freezes assets of crypto platform Vauld worth nearly Rs. 370 Crore: Details


India’s Law Enforcement (ED) Directorate on Thursday froze $46.5 million (about Rs 369.5 crore) in assets on the struggling Singapore-based cryptocurrency exchange , Vaud. The country’s economic crime unit said in a press release on Friday that the frozen assets were parked in bank accounts, payment gateway balances and wallets on crypto exchange Flipvolt. ED said it conducted searches at several premises associated with the company, Yellow Tune Technologies Pvt. Ltd, over three days starting August 8.

“These amounts were nothing more than proceeds of crime from predatory lending practices. The cryptocurrency so purchased was transferred to various unknown foreign wallet addresses,” the ED said in a press release. .

“Lax KYC standards, loose regulatory control of allowing transfers to foreign wallets without asking for any reason/declaration/KYC, not registering transactions on Blockchains to reduce costs, etc., have resulted in Flipvolt may not be able to account for the missing crypto assets,” he added.

The enforcement agency said the frozen assets belonging to Vauld’s Indian entity will remain held until it provides a full fund trail.

It should be noted that Flipvolt is the Indian branch of Singaporean crypto exchange Vauld, which suspended all deposits and withdrawals on its platform in June, following the collapse of stablecoin TerraUSD and its sister token Luna.

Last week, assets on WazirX totaling $8 million (roughly Rs. 63.5 crore) were frozen by the ED. WazirX is one of the premier crypto platforms and one of the largest exchanges in India, with volumes exceeding $43 billion (roughly Rs. 3,41,658 crore) last year.

Vauld CEO Darshan Bathija in an email sent to stakeholders last month said the exchange had accrued debts totaling $400 million (around Rs 3,178 crore) against assets of just Rs 330 million dollars (about 2,622 crore rupees).

He attributed the discrepancy to the result of growing losses brought on by exposure to TerraUSD’s decline as well as a decline in other major cryptocurrencies like Bitcoin and Ether.

“We are investigating this matter, we ask for your patience and support, we will update you as soon as we have more information on this matter,” Vauld said in a statement sent to Business Today.

Vauld is already facing financial problems and has halted withdrawals since July. The platform obtained a three-month moratorium extension a few days ago from the High Court of Singapore to explore different options.


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