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The Financial Intelligence Unit of India (FIU-IND) announced on May 10 that Binance and KuCoin have successfully registered with the regulatory authority on the same date.
It is important to highlight that these exchanges were part of a group of offshore entities that faced bans last year, which also included Huobi, Kraken, Gate.io, Bittrex, Bitstamp, MEXC Global, and Bitfinex.
Crypto Exchanges Enhance Credibility in India
Vivek Aggarwal, the head of FIU-IND, stated that this approval signifies a shift in credibility for the cryptocurrency sector within the nation.
Aggarwal mentioned that the unit intends to form a working group in partnership with the industry to evaluate compliance guidelines concerning anti-money laundering regulations for virtual digital asset service providers.
As per Aggarwal, the legitimacy and trustworthiness of the industry depend on the parliament and the government as a whole.
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Binance and KuCoin to re-launch in India after becoming the first offshore crypto exchanges to be registered with the Financial Intelligence Unit pic.twitter.com/qi9bjRPqX1
— Radar
(@RadarHits) May 10, 2024
(@RadarHits) May 10, 2024He believes that protecting the Indian economy and curbing financial crimes can assist businesses in the cryptocurrency sector in gaining greater credibility and legitimacy within the framework.
KuCoin, the first crypto entity to pay a penalty of $41,000, has already resumed its operations.
Conversely, Binance has yet to restart its operations as it is anticipated to resolve its penalty following a hearing with the FIU.
Sources familiar with the situation, as reported by The Economic Times, suggest that Binance may face a fine of $2 million.
Before its ban, Binance reportedly commanded a significant market share, representing nearly 90% of the estimated $4 billion in cryptocurrency holdings among Indian citizens.
Discussions have begun between the regulator and other sanctioned platforms, including Kraken, Gemini, and Gate.io.
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In the meantime, OKX and Bitstamp have submitted proposals to exit the Indian market.
Binance, KuCoin, and 46 Other Crypto Entities Registered in India
Aggarwal disclosed that a total of 48 crypto entities are now recognized as reporting entities under India’s Prevention of Money Laundering Act.
The meeting with financial journalists marked the first official engagement between the FIU and the cryptocurrency industry.
This followed an earlier meeting where Aggarwal and other FIU officials met with representatives from all 48 entities.
India’s position on cryptocurrencies has been somewhat unclear. The implementation of stringent crypto taxes in 2022 and the downturn in the crypto market prompted Indian traders to migrate to international exchanges, adversely affecting the local crypto sector.
However, trading volumes returned to Indian exchanges after the prohibition of offshore entities.
India has prioritized achieving global consensus on establishing crypto policies as part of its G20 presidency in 2023.
The country successfully secured agreement from all G20 members on global guidelines.
Nonetheless, India faced criticism for advocating for global consensus without having its own legislation established.
The Indian government has kept a crypto bill pending since 2021 and is expected to determine its stance in the upcoming months.
A senior lawmaker previously indicated that the bill is unlikely to be presented before mid-2025.
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