India's largest cryptocurrency exchange, WazirX to launch decentralized exchange

WazirX, is at an advanced stage to launch its own decentralised exchange, said co-founder Nischal Shetty. The co-founder said that a decentralised exchange is like building a software where peer-to-peer cryptocurrency trades can be facilitated.

In a centralised exchange, fiat can be traded for cryptocurrency. Trades can be conducted between two cryptocurrencies too. In a decentralised exchange, there is no middleman. These exchanges are peer-to-peer and based on smart contacts.

Shetty said that the decentralised exchange is undergoing tests and will be launched next month. WazirX was, in June, issued a show cause notice by the Enforcement Directorate that sought explanation regarding transactions worth Rs 2,790.74 crore due to foreign exchange violations. The ED had asked WazirX earlier this month to explain why "withdrawal from crypto wallets" was not a violation of India's foreign exchange regulations.

"Because a DEX (decentralised exchange) does not own the data, even the authorities can't really go to the developer of the exchange and say I want the data," Shetty told The Economic Times.

A growing number of 7.5 million WazirX users are interested in trading on a decentralised exchange, he said. Uniswap, MDEX are some of the decentralised exchanges worldwide.