India's government has dicovered widespread tax evasion among cryptocurrency exchanges, with Binance and WazirX identified as major offenders.
A total of $97 million in unpaid Goods and Services Tax (GST) liabilities has been revealed, highlighting deeper issues within the crypto industry.
The most significant case involves Binance, which reportedly avoided paying $85 million in GST through its subsidiary, M/s Nest Services Limited.
Despite earlier assurances of compliance, Binance's Indian operations show ongoing regulatory issues.
This revelation follows Binance’s announcement in August 2024 about its registration in India, which came after a $2.5 million fine for prior violations.
Minister of State for Finance Pankaj Chaudhary disclosed during a parliamentary session on 2 December that 17 Virtual Digital Asset Service Providers were investigated for the collective $97 million in unpaid taxes.
The 17 crypto exchanges identified for tax evasion. (Source: Ministry of Finance, Government of India)
WazirX owes $4.8 million in unpaid taxes, while CoinDCX and CoinSwitch Kuber owe $1.9 million and $1.7 million, respectively.
These firms have partially paid their dues, but Binance and Hyperux Technologies remain under scrutiny for non-compliance.
WazirX’s issues extend beyond taxes. A $235 million hack in July 2024 disrupted its operations, forcing withdrawal suspensions that remain in place.
In a statement on X (formerly Twitter), WazirX said,
“We will continue to pursue legal actions to reclaim illiquid and stolen assets actively, ensuring they are secured for Creditors’ benefit.”
The GST evasion cases are part of a larger regulatory clampdown on India’s cryptocurrency sector.
The Ministry of Finance reported that 47 Virtual Digital Asset Service Providers are now registered, an increase of 19 from last year.
However, heightened scrutiny on GST compliance and consumer security persists.
Binance’s troubles are not limited to India.
The exchange recently faced criticism for listing questionable Solana-based meme coins like The AI Prophecy (ACT) and Peanut the Squirrel (PNUT), with accusations of enabling pump-and-dump schemes.
Globally, Binance continues to deal with challenges, including a whistleblower lawsuit in the UK by former employee Amrita Srivastava, alleging wrongful termination after exposing bribery.
It also faces bans and fines, including a $10 billion settlement with US regulators and a ban in the Philippines for operating without a licence.
Earlier this week, Cambodia blocked access to the websites of 16 crypto exchanges, including Binance, due to their lack of licenses from the Securities and Exchange Regulator of Cambodia (SERC).
Despite Binance's partnerships in the country and efforts to support regulatory development, its website is now inaccessible, though its mobile app remains available.
While Binance faces regulatory setbacks, Indian authorities have made progress on the WazirX hack investigation.
Police in New Delhi recently arrested a suspect linked to the $235 million theft, though the primary culprit remains at large.
The hack, which WazirX suspects involved North Korean operatives, has further strained its user and regulatory relationships.
Past remarks by Binance co-founder Changpeng Zhao have resurfaced, with critics interpreting his 2022 comment, “I can disable the Indian outfit's wallets,” as foreshadowing WazirX’s ongoing troubles.
Binance has not yet decided on its new global headquarters due to complexities like tax laws and talent acquisition challenges. Legal troubles, including Changpeng Zhao's legal issues and a $4.3 billion fine, have led Binance to restructure its leadership and adopt better governance strategies.
WeatherlyBitcoin has reached a new all-time high, surpassing $100,000, while CZ remains unaffected by the surge, holding onto the same amount of Bitcoin. Binance Coin (BNB) also hit a record high, but CZ’s focus remains on Bitcoin’s long-term value rather than its fluctuating price.
WeatherlyCZ’s recent Toy Story meme has sparked speculation about Binance’s future, with many linking it to potential BNB institutional adoption or a BNB-based ETF. Meanwhile, BNB’s price surged to a new all-time high of $776.80, reflecting its growing market influence as altcoins, including BNB, gain momentum.
WeatherlyThe FTX bankruptcy estate claims SBF’s $1.76 billion repurchase deal with Binance in July 2021 was a fraudulent transfer due to FTX’s insolvency. The lawsuit seeks to recover billions for FTX creditors, alleging the transaction was fraudulent.
KikyoFormer Binance CEO, CZ (real name Changpeng), told Bloomberg that he had received multiple offers from buyers who are willing to offer him a high price to buy his shares in Binance.
XingChiBinance and its former CEO, Changpeng Zhao, are pushing to dismiss the SEC’s amended complaint, arguing that the regulator’s approach to crypto lacks clarity and consistency. Binance claims the SEC's broad interpretation of crypto assets as securities is confusing and unfairly applied.
WeatherlyChangpeng Zhao, founder of Binance, made his first public appearance since his prison release at the Binance Blockchain Week in Dubai, discussing his reflections on his incarceration and future plans. He expressed a renewed appreciation for personal connections, a commitment to education, and intentions to invest in emerging sectors while remaining optimistic about the future of cryptocurrency.
JoyFormer Binance CEO CZ's first tweet after his prison release sparked attention, briefly mentioning future plans and enjoying freedom. BNB surged to a monthly high but quickly reversed, declining along with the broader crypto market.
KikyoBinance founder CZ will be released today, 27 September, two days ahead of schedule, due to his release date falling on a weekend. Will this trigger a rise in BNB’s price?
KikyoIn its latest YouTube town hall, WazirX co-founder Nischal Shetty unveiled a mutitiered plan focused on helping creditors regain a portion of their funds.
XingChiWazirX faces ongoing challenges after a recent hack, as affected users plan to sue for over $600,000 in cryptocurrency assets. They seek both damages and full restoration of their crypto balances, with more victims expected to join the lawsuit as it progresses.
CatherineWazirX seems to be caught in their own web of lies. It seems that not only has the company lied about the hack, they have also blatantly lied and fake the numbers that they have submitted to the authorities.
XingChiBinance has rejected claims of responsibility for WazirX’s recent $235 million hack, calling on WazirX to address the loss of user funds while clarifying that it never completed its acquisition of the platform.
SanyaWazirX faces backlash over hack response poll, damaging reputation and raising industry concerns.
Xu LinSocial media reacts with zero-notice rug-pull accusations; CEO Nischal Shetty replies NFTs are always under self-custody.
cryptopotatoThe notorious North Korean hacker collective known as Lazarus has had a busy weekend moving millions of dollars in Ethereum.
cryptopotatoED revealed that WazirX’s utility token ‘WRX’ and an Ethereum token Tether ‘USDT’ has been frozen.
Others
Coinlive Coinlive