WazirX Hires TRM Labs to Help Detect Fraud

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In Brief
  • India’s largest cryptocurrency exchange WazirX has hired blockchain intelligence firm TRM Labs to help it detect crypto fraud.

  • TRM will help monitor, investigate, and mitigate crypto fraud and financial crimes on WazirX.

  • WazirX is doing so at a time when it has come under increased scrutiny from the nation's investigation agencies.

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India’s largest cryptocurrency exchange WazirX has hired blockchain intelligence firm TRM Labs to help it detect crypto fraud.

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WazirX is doing so at a time when it has come under increased scrutiny from the nation’s investigation agencies. For its part, TRM provides services like crypto compliance and risk management. This includes things like tools for wallet screening, transaction monitoring and investigations.

WazirX said TRM will help them monitor, investigate, and mitigate crypto fraud and financial crime on the platform.

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TRM’s benefit

Nischal Shetty, founder and CEO of WazirX, said that compliance with global regulatory requirements is critical to the exchange’s success. At the same time, he highlighted the need to meet customers’ expectations for fast, seamless transactions.

“TRM’s platform helps us achieve this balance with an AML solution that’s easy for large compliance teams to use, but also underpinned by best-in-class blockchain analytics,” Shetty said. TRM’s monitoring capability covers over 300,000 digital assets, among them Ethereum, Dogecoin, Cardano, MATIC, and Shiba Inu.

WazirX’s issues

Something of a market leader, WazirX is doing what it can to maintain its more than 6.5 million users and monthly volume of $6.2 billion. By hiring TRM, they are hoping to build confidence with Indian authorities. Lately, authorities have expressed concern that crypto assets are used for criminal activity such as money laundering and funding terrorism. Accordingly, WazirX needs “to demonstrate a robust capability to detect and prevent illicit activity from occurring on its platform”.

Last month, the Enforcement Directorate issued a show cause notice to WazirX and Shetty. It summoned Shetty to explain transactions that the agency said were in violation of India’s foreign exchange rules. The Mumbai wing of the Narcotics Control Bureau (NCB) also sought details from the crypto exchange on June 18.

They requested information regarding an alleged drug dealer who may have used the platform to deal in contraband.

WazirX isn’t alone among crypto exchanges dealing with issues in India at the moment. Cryptocurrency exchanges in India are struggling to secure payment solutions now that more banks are severing ties. Many have now come to depend on some combination of alternatives, which are poor for scaling.

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Nick is a data scientist who teaches economics and communication in Budapest, Hungary, where he received a BA in Political Science and Economics and an MSc in Business Analytics from CEU. He has been writing about cryptocurrency and blockchain technology since 2018, and is intrigued by its potential economic and political usage. He can best be described as an optimistic center-left skeptic.

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