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Indian regulators to clear offshore crypto exchanges after strict AML review | CPT PPP Coverage

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Indian regulators to clear offshore crypto exchanges after strict AML review appeared on cryptoslate.com by CryptoSlate.

India’s Financial Intelligence Unit (FIU-India) is reportedly set to approve two more offshore crypto exchanges to resume operations in the country by the end of the 2025 fiscal year, following a thorough review of their compliance with anti-money laundering (AML) laws.

The development comes as the FIU continues to assess requests from four exchanges previously banned for non-compliance with India’s stringent AML regulations.

Reconsidering registrations

The FIU, responsible for ensuring financial institutions adhere to AML standards, had earlier granted approvals to Binance and KuCoin after these platforms were initially blocked for failing to meet compliance standards.

According to sources familiar with the matter, the FIU is now reviewing four new requests. At least two exchanges are expected to be cleared following a comprehensive review process that includes assessments of transaction transparency and suspicious transaction reporting (STR).

While the names of the exchanges under review were not disclosed, the FIU emphasized that compliance with Indian financial regulations remains a top priority.

The agency plans to impose penalties where necessary, similar to the $2 million fine levied on Binance earlier this year before the exchange was allowed to re-enter the Indian market.

Sources told local media:

“Only after complete due diligence will we allow any crypto exchange to operate in India. We are very strict about compliance.”

Evolving stance

The Indian government’s stance on cryptocurrencies has evolved in recent years, with a focus on balancing innovation with financial security.

In April 2022, India introduced a 30% tax on crypto gains and a 1% tax deducted at the source (TDS) on every crypto transaction as part of its efforts to monitor the flow of digital currencies and combat illicit activities such as money laundering and terrorism financing.

India’s crypto industry has been under close scrutiny by regulators, who aim to foster a more transparent ecosystem while mitigating the risks associated with the largely unregulated digital asset space.

The upcoming approvals for additional offshore exchanges could increase competition within the domestic market, offering Indian investors more trading options and potentially enhancing liquidity.

Additionally, the Department of Economic Affairs (DEA) is expected to release a consultation paper on crypto legislation by October. This paper will seek input from industry stakeholders and will likely play a crucial role in shaping India’s long-term regulatory framework for digital assets.

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