The Financial Intelligence Unit issued a notice of noncompliance against 10 foreign crypto exchanges on Dec. 28, 2023.
Indian crypto exchanges are promising hassle-free transfers for users who want to transfer their crypto assets from foreign crypto exchanges after the country’s Ministry of Finance Financial Intelligence Unit banned off-shore crypto exchanges like Binance, OKX and others.
Several Indian crypto exchanges have created lucrative fee waiver deals for users with their funds stuck on banned foreign crypto exchanges. CoinDCX — one of the largest Indian crypto exchanges by trading volume — announced that it had set aside $1 million to help users transfer their assets to complaint crypto exchanges.
Another Indian crypto exchange, BuyUcoin, announced zero-fee transfers for users from off-shore exchanges in response to the FIU ban. A spokesperson from the exchange told Cointelegraph that they believe the FIU’s move is a correct step toward investor protection and enforcing capital flight rules and regulations on foreign exchange entities.
The FIU issued a notice of noncompliance to Binance, Huobi, Kraken, Gate.io, KuCoin, Bitstamp, MEXC Global, Bittrex and Bitfinex for illegally operating in India on Dec. 28, 2023. The FIU proposed that the Ministry of Electronics and Information Technology block the websites if they fail to comply.
On Jan. 10, nearly two weeks after the FIU notice, Apple’s India app store blocked all foreign crypto exchanges, but it was still available on the Google Play store. Within a week, the Google Play store also blocked the exchanges, creating a sense of panic among Indian users who had flocked to foreign crypto exchanges like Binance to evade a hefty 30% crypto tax.
Many Indian crypto influencers discussed alternative ways for users to access the banned platforms in India, including via virtual private networks. However, BuyUcoin advised against it, claiming there are major “negative consequences that could arise from Indian users going for new URLs as they could end up losing all their crypto assets or money due to phishing sites and other online scams.”
OKX has reportedly started asking Indian users to update their personal information to comply with local regulations, indicating a move toward FIU compliance.
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