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ED asks CoinDCX, CoinSwitch to submit documentation over FEMA violation allegations

Enforcement Directorate (ED) asks a few cryptocurrency firms including CoinSwitch and CoinDCX for submitting some documents to explore any link with an ongoing case of the Foreign Exchange Management Act (FEMA).

FEMA is an act of parliament of India which applies the laws regarding foreign exchange with the aim of promoting external and promoting the orderly development and maintenance of foreign exchange market in India.

This law was cited on 29th December 1999 in parliament of India. However, Foreign Exchange Management (FEMA) replaced Foreign Exchange Regulation Act (FERA).

Additionally, the ED is exploring these cryptocurrency firms for checking whether these companies are a part of foreign exchange violations or not.

Moreover, they sent notices to both CoinSwitch and CoinDCX companies which deal with cryptocurrency exchange, according to the reports.

Moreover, even the founder of CoinDCX Sumit Gupta was queried by ED in the Bengaluru office.

Also, ED recorded his statements amid the inspection. And even other people who work in Cryptocurrency exchange were sent notices to record their statements. Later, according to the reports, ED will track all the transactions of the last three years of these firms and will also question their CA.

After this news came to light, CoinSwitch confirmed that, ‘We receive queries from various government agencies. Our approach has always been one of transparency.’

‘Crypto is an early-stage industry with a lot of potential and we continuously engage with all stakeholders,’ CoinSwitch spokesperson said.

Also CoinDCX published a statement which read as, ‘The ED has sent notices to major exchanges in India seeking information and data on how platforms work’.

‘As required, we have shared all necessary information to the satisfaction of the department and no subsequent action is pending at our end’.



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