India’s financial regulator may grant two foreign-based crypto exchanges approval to operate in the country by March 2025.
According to a report by local media outlet Business Standard, the country’s Financial Intelligence Unit (FIU) is currently reviewing registration applications from four offshore cryptocurrency exchanges. While the specific platforms remain undisclosed, the report cited an anonymous source who claimed that two of them might get approval to start operations by the end of the 2025 financial year.
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Last year, the FIU issued show cause notices to nine foreign cryptocurrency exchanges, including Binance, KuCoin, Huobi, Kraken, Gate.io, Bittrex, Bitstamp, MEXC Global, and Bitfinex. The regulator stated that these platforms had not met registration requirements and were non-compliant with India’s anti-money laundering regulations.
Subsequently, access to the websites and mobile apps of the affected platforms was blocked for Indian users as part of a crackdown under India’s Prevention of Money Laundering Act. This action followed a March 2023 directive from the Indian Finance Ministry mandating cryptocurrency exchanges to register as reporting entities with the regulator.
However, Binance and KuCoin recently got the regulatory nod to resume operations in the country after their seven-month absence.
Business Standard’s source revealed that the other two exchanges seeking approval would face a “thorough review of transaction visibility, suspicious transaction reporting, and related compliance issues” before being granted permission to resume operations. Additionally, penalties would be determined based on the scale of their previous operations and the extent of their non-compliance before the ban.
“Only after complete due diligence will we allow any crypto exchange to operate in India. We are very strict about compliance,”
the source reportedly stated.
Meanwhile, the Indian government recently announced plans to release a public consultation paper on comprehensive cryptocurrency regulations in October 2024. A special panel, led by the Secretary of the Department of Economic Affairs (DEA), will introduce the paper to solicit input from industry experts and stakeholders on the best way to regulate the country’s growing crypto-assets sector.
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