Indian Authorities Warn Nine Crypto Exchanges
The Financial Intelligence Unit India (FIU IND) has issued compliance Show Cause Notices to nine offshore crypto exchanges including Binance, Kucoin, Huobi, Kraken, Gate, Bittrex, Bitstamp, MEXC, and Bitfinex. These notices serve as a warning that the authorities can take enforcement actions against these exchanges for not complying with registration laws in India.
India Blocks URLs of Top Exchanges
The FIU IND has requested the Ministry of Electronics and Information Technology to block the URLs of Binance, Kucoin, and other exchanges on the list. Until these exchanges register with the FIU IND, they will not be allowed to operate efficiently in India.
Compliance with AML-CFT Framework Required
In March 2023, crypto exchanges were brought under the scope of the Anti Money Laundering/Counter Financing of Terrorism (AML-CFT) framework in India. It was discovered that these exchanges had violated this framework. The FIU IND has jurisdiction over activities such as exchange between digital assets and fiat currencies, transfer of digital assets, and safekeeping or administration of digital assets.
Crypto Exchanges Seek Solace in Different Jurisdictions
Regulatory uncertainty is a major challenge faced by crypto exchanges globally. As India becomes one of the largest crypto markets, there is a growing need for a robust regulatory framework. The International Monetary Fund (IMF) and the Financial Stability Board (FSB) are working on crypto regulations to guide players in the industry.
Many crypto exchanges are looking to expand outside the United States to other regions. However, options are becoming limited as other jurisdictions tighten regulations on crypto exchanges.
Hot Take: Indian Authorities Crack Down on Non-Compliant Crypto Exchanges
Indian authorities have issued warnings to nine major crypto exchanges for failing to comply with registration laws. These exchanges, including Binance and Kucoin, have been asked to register with the Financial Intelligence Unit India (FIU IND) or face enforcement actions. The FIU IND has also requested the blocking of their URLs in India until they comply. This move highlights the growing need for a strong regulatory framework in India’s booming crypto market. As regulatory uncertainty persists globally, crypto exchanges are facing challenges in different jurisdictions as they seek expansion.
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