Key Insights
- The Financial Intelligence Unit (FIU) of India has ordered the blocking of nine major crypto exchanges, including Coinbase and Binance
- The FIU cited concerns about unregistered exchanges promoting money laundering, terrorism financing and putting Indian users at risk.
- India has now joined a growing list of countries, including the US, China, and the UK, that are tightening regulations on the crypto industry.
- The FIU’s move deals a blow to India’s estimated 15 million crypto users who will have limited options for trading digital assets.
India has become the latest country to take a stance against the crypto industry.
In recent developments, the country’s Financial Intelligence Unit (FIU) has announced that it will be booting about nine major exchanges, including Coinbase and Binance, for violating the country’s anti-money laundering and anti-terrorism financing laws.
FIU: Crypto Exchanges Are Operating Illegally
On Thursday, the Indian Financial Intelligence Unit released a statement. This statement claimed that several cryptocurrency exchanges operating in the nation were violating laws, by failing to register with the FIU and adhere to the requirements set out by the Prevention of Money Laundering Act (PMLA) 2002.
Thirty-one VDA SPs have reportedly registered with the FIU thus far.
However, the FIU’s report also says that a large percentage of Indian users instead use unregistered exchanges, which increases the danger of financing terrorism and money laundering.
As a result, the FIU has asked that the websites of the following nine cryptocurrency exchanges in India be blocked by the Ministry of Electronics and Information Technology till further notice: Bittrex, Bitsamp, MEXC Global, Bitfinex, Gate.io, Kucoin, Huobi, Kraken, and Binance
India Joins Global Clampdown on Crypto Industry
The FIU’s enforcement action makes India the latest country to crack down on the crypto industry, which has been under increasing regulation in recent months.
Recall that Binance, the largest crypto exchange in the world was fined $4.3 billion by the CFTC in the US last month, for breaking anti-money laundering regulations.
Changpeng Zhao, the founder and CEO of Binance, also agreed to resign from his position and plead guilty to these anti-money laundering laws.
Zhao also awaits sentencing in February and is currently banned from leaving the country.
Other countries like China, the UK, Japan, and Canada have also taken similar actions against crypto exchanges in recent months, citing worries about consumer safety, financial stability, and national security.
The crypto industry, nevertheless, is still going strong despite these governmental obstacles.
Certain cryptocurrency exchanges, including Coinbase and Gemini, have attempted to secure licenses from the appropriate authorities, while others like PancakeSwap and Uniswap, have chosen to work as decentralized exchanges, that do not need custodians or middlemen.
In general, the FIU’s move to shut down nine cryptocurrency exchanges in India is a serious setback for the nation’s roughly 15 million crypto users, according to a recent Chainalysis report.
Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information, but it will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.
