India tightens crypto grip AML CFT probes crypto exchanges

India tightens crypto grip  AML CFT probes crypto exchanges


  • Virtual Digital Assets Service Providers are now part of India's AML-CFT framework, according to the PML Act, 2002
  • In a case of noncompliance, the Indian FIU issued Show Cause Notices to nine prominent offshore cryptocurrency exchanges
  •  The fact that 31 VDA SPs have registered with FIU IND shows progress toward compliance, even if there have been regulatory hurdles

Under the terms of the Prevention of Money Laundering Act (PML) Act, 2002, Virtual Digital Assets Service Providers (VDA SPs) in India will be subject to the strict Anti-Money Laundering/Counter Financing of Terrorism (AML-CFT) framework beginning in March 2023. With this decision, the nation's strategy for overseeing and controlling the rapidly growing cryptocurrency business has undergone a sea change.

In a move towards stricter compliance, the Financial Intelligence Unit India (FIU IND) has taken action by sending show-cause notices to nine renowned offshore VDA SPs. These SPs include Binance, KuCoin, Huobi, and Kraken, among others, according to Section 13 of the PMLA. The businesses in question have been operating in India, violating several sections of the PML Act, and these notifications are a direct consequence.

The Director of FIU IND has urged the Ministry of Electronics and Information Technology Secretary to ban the URLs of these non-compliant organizations, further emphasizing the agency's regulatory posture. The offshore VDA SPs that serve many Indian users but have evaded registration and compliance with India's anti-money-laundering and counter-financing-terrorism regulations are the target of this crackdown.

In light of these regulatory hurdles, it is encouraging to see that 31 VDA SPs have registered with FIU IND, indicating an increasing trend of industry-wide compliance. However, a crypto influencer named Lark Davis has spoken out against the government's decision to restrict access to Binance and Kraken, describing the move as "dumb" and showing that the government does not comprehend the cryptocurrency market.

There will be favorable progress in the future of cryptocurrency exchanges, especially in the Indian industry. Users throughout the globe should anticipate safer and more dependable services from the sector as exchanges adjust to compliance needs and regulatory frameworks become clearer.

Tags : Binance Exchange  Crypto market  cryptocurrency  Kraken  Kucoin  crypto

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