India Issues Compliance Notices to Binance and Other Offshore Exchanges
India’s Ministry of Finance has sent compliance show cause notices to Binance and eight other offshore exchanges for operating illegally in violation of anti-money laundering policies. The Financial Intelligence Unit (FIU) of India addressed the notices to Binance, KuCoin, Huobi, Kraken, Gate.io, Bittrex, Bitstamp, MEXC Global, and Bitfinex. The FIU also intends to block local investors from accessing these platforms by taking steps to block non-compliant Virtual Digital Assets Service Providers’ URLs.
The crackdown on Binance and other foreign exchanges aligns with India’s Prevention of Money Laundering Act (PMLA). However, no timeframe for the platforms to respond has been disclosed.
Mandatory Registration for Crypto Businesses in India
In March, India’s Ministry made it mandatory for crypto businesses to register with the FIU and comply with PMLA provisions. As of December 4th, 28 cryptocurrency firms had registered with the national anti-money laundering agency.
“The obligation is activity-based and is not contingent on physical presence in India. The regulation casts reporting, record-keeping, and other obligations on the VDA SPs under the PML Act which also includes registration with the FIU IND.”
India’s FIU
India’s Mixed Stance on Crypto
Crypto regulation remains a contentious topic in India. While Finance Minister Nirmala Sitharaman calls for international collaboration to develop a comprehensive crypto framework and emphasizes blockchain’s benefits, the Reserve Bank of India maintains its stance advocating for a blanket ban on virtual currencies.
Hot Take: India Tightens Grip on Crypto Industry
India’s Ministry of Finance continues to assert its authority over the crypto industry by issuing compliance notices to offshore exchanges. By cracking down on Binance and other foreign platforms, India aims to ensure compliance with anti-money laundering policies and the Prevention of Money Laundering Act. The requirement for crypto businesses to register with the Financial Intelligence Unit further strengthens regulatory oversight. However, conflicting opinions within the Indian government highlight the ongoing debate surrounding crypto regulation in the country.
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