According to India's ED, 23 entities deposited Rs 370 crore (~$46.5 million) into FlipVolt, which the ED says were the proceeds of criminal activity. FlipVolt had "very lax KYC norms, no EDD [enhanced due diligence] mechanism, no check on the source of funds of the depositors, no mechanism of raising STRs [suspicious transaction reports], etc" and reportedly enabled the entities to launder the proceeds of crimes via the exchange.
India's Enforcement Directorate froze $46.5 million of assets belonging to FlipVolt, the Indian branch of the Vauld cryptocurrency exchange. Vauld had previously filed for protection from creditors—a process in Singapore that is similar to Chapter 11 bankruptcy in the U.S.—on July 8, only four days after suspending withdrawals. Vauld subsequently announced a shortfall of around $70 million due to the Terra collapse and other factors, and reportedly owes creditors $363 million.