The Enforcement Directorate (ED), India’s financial crimes watchdog, has frozen 77.6 bitcoins that had been transferred to Binance from an account linked to the Indian cryptocurrency exchange Wazirx, according to a report published Feb. 12.
In addition to the bitcoin transfer, ED froze four bank accounts associated with Wazirx, including one used for fiat currency deposits, three others used for withdrawals, and another for transfers.
According to the report, ED began investigating Wazirx over allegations of money laundering relating to the purchase of virtual items within the mobile game Coin Dots. In January 2018, Wazirx suspended trading due to regulatory concerns.
On Jan. 14, 2018, the ED reportedly received information about suspicious transactions involving Wazirx. On Jan. 16, the agency conducted searches of the exchange’s offices, seized data storage devices and arrested several employees.
The ED stated that it believed Wazirx was involved in money laundering and fraud against customers. However, no charges have been filed against anyone.
Wazirx did not immediately respond to requests for comment.
Indian Authority Freezes Bitcoin Held at Crypto Exchange Binance
India’s Directorate of Enforcement (ed) announced Wednesday that it had frozen 77.6271014 bitcoin under the country’s Prevention Of Money Laundering Act (PMLA). The ED is the Indian Government’s law enforcement and economic Intelligence Agency.
The freeze is part of the ed’s investigation into a mobile game called ‘E-nuggets’, which was designed for the purposes of defrauding the public. Aamir Khan, son of famous actor Dr. Aamir Khan & his wife Kiran Rao, allegedly owns 50% of the shares of the company.
According to the announcement, the crypto currency was transferred from Wazirsx, a popular Indian Exchange, to Binance. The ED also tweeted a summarized version of the action.
How did the fraud happen?
In 2017, Khan launched his first mobile game called E-Nuggets, which allowed players to earn virtual currency by answering questions about cricket. In 2018, he announced that he would launch a second version of the game, dubbed E-Nuggets 2.0. However, it seems that Khan didn’t stop there. He allegedly registered multiple accounts on Wazar X, a cryptocurrency exchange based out of India, and used those accounts to buy cryptocurrencies and send them to Binance.
According to reports, Khan had been scammed himself in December 2019 when Binance stopped processing payments sent to him via Wazar X. After being alerted by Binance, ED raided Khan’s residence and confiscated his phone. On February 21, the Enforcement Directorate carried out searches at Khan’s house in Mumbai. They reportedly found around Rs 50 lakh worth of cash, along with documents related to the alleged scheme.
Bitcoin price due ‘big dump’ after passing $20K, warns trader
The cryptocurrency markets are bracing themselves for what could be another big drop following a massive run-up earlier this week. On Wednesday, bitcoin broke above the key resistance level of $19,500 and continued to climb throughout Thursday, reaching a high of $21,300. However, since then it has been falling steadily, hitting a low of just over $17,400 on Friday morning.
According to crypto analyst @crypto_otaku, there is no reason why the bitcoin price shouldn’t fall further, as it has already passed the previous highs set during 2017. He says that while he expects the decline to continue, it won’t necessarily be dramatic.
“I think we’re due for a big dump here. I’m still expecting this to happen, but not necessarily in the next 24 hours. If you look at the chart, we’ve already broken down some support levels and hit a few resistance levels. So it looks like a good place to buy,” he told CNBC via email.
He added that he thinks the current dip will likely lead to a strong rebound in the coming days.
“If you look at the daily chart, we’re now approaching the descending triangle pattern. This is where the price usually bounces off and starts to move up again. There’s a lot of volume here, so I’d say there’s a decent chance we’ll see a bounce here,” he said.
Meanwhile, pro traders aren’t expecting the bitcoin price to reach anywhere near $20,000 any time soon. In fact, one prominent crypto investor doesn’t even think it will make it past $10,000 in the long term.
@Crypto_Otaku believes that the recent rally is unsustainable because investors are buying into hype rather than fundamentals.