India’s Crackdown on Crypto Exchanges: Binance, Kraken, Mexc, and Kucoin Delisted from App Store

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Binance, KrakenMexc and Kucoin are among the biggest cryptocurrency exchanges ever directed by India’s Financial Intelligence Unit (FIU), which took further action against them by deleting their apps from the Apple App Store in India. As a result of the introduction of new rules for taxation of virtual currencies in the previous year, this new development represents an important step in India’s ongoing attempts to regulate the cryptocurrency business.

At the end of the month of December 2023, the Financial Intelligence Unit (FIU) issued show-cause letters to nine cryptocurrency companies stating that they violated India’s anti-money laundering laws. Huobi, Gate.io, Bittrex, and Bitfinex are among the nine exchanges that have been targeted. Bitstamp is the only identified exchange whose app is still live on India’s App Store.

This move by the Financial Intelligence Unit (FIU), which is a division of India’s Ministry of Finance, is a reflection of the increasing scrutiny and regulatory pressure being applied to cryptocurrency businesses in India. The nation introduced a tax policy in 2023 that includes a thirty percent tax on revenue from cryptocurrency transactions and a one percent deduction for each transaction. As a result of the strict regulatory environment, a significant number of dealers in India have shifted their operations to global cryptocurrency platforms in what appears to be an attempt to avoid paying these taxes. However, India-based cryptocurrency exchanges such as CoinSwitch Kuber and CoinDCX continue to implement strict Know Your Customer (KYC) checks.

The Financial Intelligence Unit (FIU) has recommended the Ministry of Electronics and Information Technology (MeitY) to restrict the URLs of these nine cryptocurrency exchanges in India. This is a key step towards stopping the activities of these global platforms in the nation. This action is taken with the intention of ensuring that these organizations comply with the Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) framework provided in India’s Prevention of Money Laundering Act (PMLA) since 2002

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By taking these moves, the Financial Intelligence Unit (FIU) has demonstrated India’s commitment to regulating the cryptocurrency industry and protecting its financial system from the potential dangers associated with uncontrolled digital assets. Intending to send a strong message about its stance on maintaining compliance in the cryptocurrency industry, the Indian government is targeting key businesses such as Binance and Kraken.

CoinDCX and CoinSwitch Kuber, two cryptocurrency exchanges based in India, had earlier issued a warning to the government, saying the new tax policy could potentially push customers to decentralized exchanges or services that do not comply with regulations. The government’s desire to manage the cryptocurrency market and prohibit any evasion of the legal framework is shown by the recent crackdowns that have taken place with this intent.

It will be very important to keep a close eye on the reactions of these global exchanges as the situation continues to develop, as well as the impact this will have on the Indian cryptocurrency market as a whole. There is a possibility that the strong stance taken by the Indian government could transform the digital currency trading landscape in the nation, which would have an impact on both traders and exchanges.

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