CoinSwitch Kuber co-founder and CEO Ashish Singhal has clarified on Twitter that his firm is cooperating with India’s Enforcement Directorate (ED) after the ED carried out raids on the cryptocurrency exchanges’ official premises, the residences of directors, as well as Singhal’s residence.
As initial reports had hint that the raids were conduct in connection with violation of the Foreign Exchange Management Act (FEMA) norms, Ashish Singhal says that the ED is engage with CoinSwitch Kuber to understand the functioning of the crypto exchange.
Ashish Singhal Said :
Crypto is a new asset class. Being in early stages, cryptos are not yet clearly classified in most parts of the world.
— Ashish Singhal (@ashish343) August 27, 2022
Now, the law (in India and elsewhere) is still assessing if crypto is a “commodity”, “security”, “currency” or something new.
This is a work in progress.
Enforcement Directorate – Bengaluru has been engaged with us with respect to functioning of our crypto platforms / exchanges. We are fully cooperating with them.
— Ashish Singhal (@ashish343) August 27, 2022
As per reports and CoinDesk indicate last week that the searches were relate to the country’s foreign exchange statutes.
Authorities in India have conducting investigations into the country’s crypto exchange ecosystem for months.
Ashish Singhal didn’t address the specifics behind the Enforcement Directorate’s actions, but highlight the still-unsettle nature of crypto regulation in India.
Ashish Singhal Said :
The classification of crypto and the nature of business models matter, as this decides how and what the laws that govern foreign exchange are, and if at all applicable.
— Ashish Singhal (@ashish343) August 27, 2022
As per report, per a source with knowledge of the process, financial records were seized during the office visits and officials ask questions regarding “foreign investments, income and outflows to check on compliance.”
CoinSwitch raise a $260 million (approx. Rs. 2,076 crore) Series C funding round last October and is back by venture capital majors including Andreessen Horowitz (a16z) and Tiger Global, among many others.