NEW DELHI/SINGAPORE: Indian cryptocurrency exchange WazirX has established a new entity in Panama, named Zensui Corporation, as it prepares to transfer its crypto-related services away from Singapore in response to tightening regulations under the city-state’s Financial Services and Markets (FSM) Act, 2022, which is set to take effect on June 30.
The crypto firm informed the Singapore Supreme Court that its Singapore-based arm, Zettai Pte Ltd, has initiated the process of moving its digital asset operations to Panama. The move is aimed at circumventing stricter licensing requirements that will soon be enforced by the Monetary Authority of Singapore (MAS).
“Zettai has taken steps to incorporate a subsidiary, Zensui Corporation in the Republic of Panama, and has been preparing for the transfer of the operations of the platform’s cryptocurrency-related services to Zensui, if necessitated by changes in the regulatory landscape,” WazirX said in its court filing.
Panama has emerged as an attractive jurisdiction for crypto businesses, largely due to its lenient regulatory environment. This shift is expected to allow WazirX—operating under Zensui—to continue offering uninterrupted services while facing fewer compliance burdens than in Singapore.
Background: Fallout from Major Cyber Attack
This strategic move comes nearly a year after a significant cyber attack drained approximately $235 million—around 45% of WazirX’s total reserves—from one of its wallets in July 2024. The breach, allegedly carried out by the North Korean Lazarus Group, led to the suspension of trading and withdrawals, widespread panic among users, and increased regulatory scrutiny.
Following the hack, WazirX announced a court-supervised restructuring plan to repay affected users. The proposal, which has been approved by over 75% of the creditors, stipulates that reimbursements will be calculated based on current crypto valuations, rather than prices at the time of the breach. So far, the exchange has recovered $3 million in stolen funds.
The attack impacted over 4.4 million Indian users and contributed to a broader sense of distrust in crypto platforms in India, which has already witnessed issues with other players like BitBNS and the infamous Morris Coin scam of 2021.
India Compliance and Regulatory Status
In the same court filing, WazirX clarified that Zettai has no intentions of registering with India’s Financial Intelligence Unit (FIU-IND). Instead, the company stated that compliance obligations are handled by its Indian entity, Zanmai India, which is already registered with the FIU-IND.
WazirX further affirmed that neither Zanmai India nor Zettai has received any notice, warning, or penalty from Indian authorities regarding non-registration as of July 2024. The FIU-IND, according to the company, has not raised objections so far.
Wider Implications for India’s Crypto Sector
Despite a string of setbacks and one of the world’s harshest tax regimes on digital assets—including a 1% tax deducted at source (TDS) and a flat 30% tax on crypto gains—India remains one of the most active nations in the global crypto ecosystem in 2024.
However, regulatory uncertainty still looms large. The Supreme Court of India has questioned the central government’s prolonged delay in introducing clear laws governing cryptocurrency and digital assets, citing serious financial stability concerns. Reports indicate that a comprehensive discussion paper on crypto regulations is expected to be released later this month.
As crypto firms adjust to a complex and evolving legal landscape, WazirX’s pivot to Panama reflects the broader industry trend of seeking regulatory havens to ensure operational continuity and safeguard user access to digital asset services.
