WazirX CEO Nischal Shetty, Co-founder Siddharth Menon Shift Base to Dubai: Report
Moneylife Digital Team 19 April 2022
Nischal Shetty and Siddharth Menon, co-founders of Indian cryptocurrency exchange WazirX, have shifted their base to Dubai from India, says a report from Business Today quoting multiple sources with the knowledge of the matter.
Sources told the news portal that both Mr Shetty and Mr Menon moved out of India with their families to Dubai, although WazirX still has an office in Mumbai and Bengaluru. "The development comes amidst Indian government imposing a 30% tax on virtual digital assets and 1% tax-deductible at the source (TDS), a move which has led to a significant drag in trading volumes on homegrown cryptocurrency exchanges," the report says.
Last month, Pankaj Chaudhry, Union minister of state for finance, told the Lok Sabha that the government has investigated 11 crypto-currency exchanges and recovered Rs95.86 crore, including interest and penalty. 
Zanmai Labs Pvt Ltd (WazirX) was one of the 11 crypto-currency exchanges booked for evading GST worth Rs81.54 crore.
"The government does not collect any data on crypto-currency exchanges. Few cases of evasion of goods and services tax (GST) by crypto-currency exchanges have been detected by the central GST formations," the minister had said.
Other crypto-currency exchanges investigated by the government include, Coin DCX, Buy Ucoin, CoinSwitch Kuber, UnoCoin, Flitpay, Zeb IT Services Pvt Ltd, Secure Bitcoin Traders Pvt Ltd, Giottus Technologies Pvt Ltd, Awlencan Innovations India Ltd (Zebpay), and Discidium Internet Labs Pvt Ltd, the written reply given by Mr Chaudhry shows. (Read: No Data On Cryptocurrency Exchanges, But the Govt Collected Penalty for GST Evasion)
Earlier in February 2022, calling private crypto-currencies a threat to the macroeconomic and financial stability of the country, Shaktikanta Das, governor of the Reserve Bank of India (RBI), had warned investors to keep in mind that they are investing at their own risk. "Crypto does not have an underlying, not even a Tulip," he had said.
Even before that, in June 2021, the enforcement directorate (ED) had issued a show-cause notice to WazirX and its directors for contravention of the Foreign Exchange Management Act (FEMA) for transactions involving cryptocurrencies worth Rs2,790.74 crore. 
"During the course of the investigation, it was seen that the accused Chinese nationals had laundered proceeds of crime worth Rs57 crore approximately by converting the Indian rupee deposits into crypto-currency Tether (USDT) and then transferring the same to Binance (exchange registered in the Cayman Islands) wallets based on instructions received from abroad," the ED said in a statement. 
ED had said, "In the period under investigation, users of WazirX via its pool account, have received incoming crypto-currency worth Rs880 crore from Binance accounts and transferred out crypto-currency worth Rs1,400 crore to Binance accounts. None of these transactions are available on the blockchain for any audit or investigation". (Read: WazirX Crypto-currency Exchange Gets Notice from ED under FEMA for Transactions Worth Rs2,790 crore)
Coming back to the report, it says Sameer Mhatre, a co-founder and the chief technology officer (CTO) at WazirX, continues to operate from India, while the entire workforce at the crypto-currency exchange is working remotely. 
Mr Shetty has been criticising the Indian government's move to impose TDS. He says, "India saw about $100B in trading volume last year. This trading would be from millions of people combined. 1% TDS = $1 billion. But majority of this TDS would need to be refunded as turnover is not profit."
According to Business Today, Mr Shetty had also announced his project Shardeum with the US-based crypto innovator Omar Sayed. Shardeum is a layer-1 blockchain project that will solve scalability and higher transaction concerns around crypto tokens.
"Notably, Dubai has turned into a hotspot for cryptocurrency innovators and influencers after India imposed taxes on crypto transactions. India's crypto and web3 start-ups have flocked to UAE, especially Dubai, where there are no income tax provisions and the government has formed a regulatory body for trading in virtual digital assets," the report says.
2 months ago
i see a vast increase in no of flights from india to dubai in a few days.I also see a vast no of properties being auctioned in india owned by absonding people by ed,etc under Modjee regime.
2 months ago
soon Dubai, UAE would corporate casinos .. they would be comfortable rather being nosed rummaged by multiple revenue intelligence agencies 24x7 basis
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