Overview
- Agencies say the off-grid network funnels untraceable funds that could revive separatist activity, putting the security establishment on high alert.
- A Jammu and Kashmir Police study with central agencies identified handlers in China, Malaysia, Myanmar and Cambodia guiding locals to open private wallets via VPN without KYC.
- Wallet holders reportedly travel to Delhi and Mumbai to convert crypto to cash through unregulated P2P traders, which officials say breaks the financial trail.
- Operators use layered mule accounts, pay commissions of roughly 0.8–1.8% per transaction, and take full control of net-banking credentials across multiple accounts.
- Jammu and Kashmir Police have suspended VPN services in the Valley, while only 49 exchanges are FIU-registered for 2024–25 despite new liveness, geographic tracking and penny-drop checks that off-exchange flows still evade.