Last updated on September 9th, 2024 at 06:19 am
India’s Financial Intelligence Unit (FIU-India) is preparing to approve two offshore cryptocurrency exchanges to operate in the country by 2025. This decision is expected to offer relief to crypto users in India, who have faced limited options since several exchanges ceased operations due to non-compliance with anti-money laundering (AML) regulations. The FIU-India will assess a total of four exchanges, with two set to receive approval based on their adherence to strict compliance requirements.
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Stringent AML Compliance Requirements
The identities of the offshore exchanges under consideration have not yet been released. However, these platforms will be subjected to the same rampant anti-money laundering standards that have seen the exit of exchanges, including Binance and KuCoin, in 2023. More specifically, the exchanges needed to fully comply with the visibility requirements in transactions, STRs, and the other AML measures prescribed by Indian authorities. Such a stringent approach is a guarantee that will only allow those exchanges with the potential to adhere to a high level of transparency and ability to comply with various regulatory demands to carry out their business in the Indian market.
Re-Entry of Binance and KuCoin into the Indian Market
Binance and KuCoin, two leading international crypto exchanges, have been restricted earlier from doing business in India for violation of these AML laws. However, KuCoin was the first to regain its operations in the market in March 2024 after meeting all regulatory fines of over 35 lakh INR. Binance, too, later in August 2024, invested over $2 million to justify the setup of the Financial Intelligence Unit to continue their services in India.
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The return of these major exchanges will bring dramatic changes due to the belief that more offshore exchanges will follow the regulatory rules and set up their base in India. Indians using crypto can now expect more availability of foreign sites while complying with the measures needed in the eyes of Indian governing structures.
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Maxwell Mutuma
Maxwell is a crypto-economic analyst and Blockchain enthusiast, passionate about helping people understand the potential of decentralized technology. He writes extensively on topics such as blockchain, cryptocurrency, tokens, and more for top publications such as Coingape, Coin Edition, and The Coin Republic. His goal is to spread knowledge about this revolutionary technology and its implications for economic freedom and social good.