Updated at 12.16am IST, March 23: KuCoin said it has become the first global crypto exchange to comply with India’s FIU. KuCoin said it will support local banks in India and other fiat entities and will invest in educating the market about the potential of crypto.
“This is not just a milestone for KuCoin but a monumental stride for India’s crypto market and the global crypto industry,” it said in a statement. “It symbolizes our dedication to expanding our global footprint and our commitment to the Indian market—where the potential for crypto is immense and the future looks bright.”
Our original story follows.
Crypto exchange OKX is ceasing services for users in India, it said in an email to customers Thursday, advising them to withdraw their funds by the end of April.
The move follows Apple and Google pulling the eponymous app of OKX in the country after an Indian government agency said many crypto exchanges were operating illegally in the South Asian market.
Financial Intelligence Unit, the government agency, named Binance, Kraken, Huobi and Gate.io among apps operating “illegally” in India but hadn’t named OKX in its public statement.
OKX has advised customers in India to close all their active margin positions and withdraw all funds by April 30. The crypto exchange cited “local regulations” for its action. An OKX spokesperson said the company’s DeFi web3 services will remain available to customers in India.
“We recently sent an email to customers in India who had historical CeFi accounts on OKX, and we are helping them close out those accounts,” an OKX spokesperson said in a statement. “As we offboard those customers their assets will remain secure on the OKX platform. This decision was made in response to recent local regulations directed at offshore exchanges that make CeFi trading available in India. OKX’s DeFi Web3 services remain available to developers and creators in India.”
Cryptocurrencies were brought into the ambit of anti-money laundering and counter-financing of terrorism framework in India in March last year. Dozens of firms — including local exchanges CoinSwitch and CoinDCX — had registered with the FIU, but several international exchanges remained in noncompliance with the law, the FIU said late last year.
Several traders in India had flocked to global cryptocurrency platforms in an apparent move to evade taxes. India began taxing virtual currencies in 2022, levying a 30% tax on the gains and a 1% deduction on each crypto transaction.
While India-based crypto exchanges continued to require rigorous know-your-customer verifications before onboarding new users, the same hasn’t been true of many global platforms. Coinbase stopped signing up consumers in India last year.