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India currently has no plans to introduce legislation regulating the sale and purchase of cryptocurrencies, according to a statement from the Finance Ministry.
In a written response to the lower house of Parliament, Minister Pankaj Chaudhary clarified that the Financial Intelligence Unit (FIU) holds authority over specific aspects, such as the prevention of money laundering and terrorism financing. The FIU has the power to designate certain digital asset service providers as official Reporting Entities.
India Pushes for Global Crypto Standards, Targets Foreign Exchanges
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Chaudhary also highlighted that during India’s G20 presidency last year, a joint framework for regulating cryptocurrencies was adopted. This framework outlines an approach to managing crypto-related risks, particularly in developing countries. All nations, including India, are encouraged to assess their specific crypto challenges and collaborate with global organizations to develop appropriate regulations.
India’s finance ministry began taking a stricter stance on cryptocurrency exchanges last year, issuing legal notices to several major foreign crypto platforms. These included Binance, Kucoin, and Huobi. The notices alleged that these platforms were operating illegally in India due to non-compliance with anti-money laundering regulations.
Binance Faces $2.25M AML Fine Amid Plans to Reenter India
Binance was exploring a return to the Indian market in April. As part of the regulatory process, India’s financial intelligence unit imposed a $2.25 million fine on the exchange for violating anti-money laundering regulations. This represents the largest penalty ever levied on a cryptocurrency company in India for such offenses.
Additionally, Binance is reportedly dealing with goods and services tax (GST) issues in India. Earlier this week, a state zonal unit of the Directorate General of GST Intelligence (DGGI) issued a show-cause notice to the exchange, demanding $86 million under GST regulations.
