NEW DELHI, India, Tuesday, July 2, 2024 – Cryptocurrency exchange giant Binance has been cleared to resume operations in India, following a period of suspension imposed in December 2023. The decision comes with conditions, including a $2.25 million fine for failing to comply with anti-money laundering (AML) regulations.
Financial Penalty: Binance must pay ₹18.8 crore (approximately $2.25 million) for its past non-compliance with AML rules.
Strict Adherence: Moving forward, Binance is required to strictly adhere to all Indian regulations governing virtual digital assets (VDAs), including AML and tax laws.
Potential Shift in Policy
The decision signifies a potential shift in India’s stance on cryptocurrency exchanges. While Binance’s return is conditional, it suggests a path forward for compliant crypto businesses in the Indian market.
Impact on Users
Indian users who previously relied on Binance can potentially return to the platform, but only if Binance adheres to the stipulated regulations.
Uncertain Future
The re-entry of a major player like Binance could invigorate the Indian cryptocurrency ecosystem. However, questions remain about how Binance will navigate the regulatory landscape and regain user trust after the suspension.
Binance’s past controversies, including allegations of money laundering by its founder, are mentioned.
The potential impact on homegrown Indian crypto exchanges is discussed. The ongoing debate surrounding the legitimacy of cryptocurrencies in India is noted.
“In November 2019, Binance had announced the acquisition of Indian crypto exchange WazirX. Zhao said at the time, “The acquisition of WazirX shows our commitment and dedication to the Indian people and strengthen the blockchain ecosystem in India.” But in August 2022, Zhao claimed his firm had never finalised a deal to acquire WazirX, days after the homegrown platform was accused of evading oversight by local agencies,” a report on Livemint said.
“Binance’s potential return to the Indian market could mean more trouble for homegrown exchanges. India’s cryptocurrency industry has been in the doldrums since 2022, when the union government introduced a 30% tax on crypto earnings and a 1% tax deducted at source (TDS) on every crypto trade. Since then daily average trades on India’s largest exchanges, WazirX and CoinDCX, have cratered by up to 90%.” It said.
