India may witness the comeback of four offshore cryptocurrency platforms, according to reports from the Financial Intelligence Unit (FIU), the country’s financial watchdog. Business Standard reported that four offshore exchanges have expressed interest in operating in India, following the recent approval given to Binance and KuCoin by the financial regulator.
Previously banned exchanges, KuCoin and Binance, faced fines of $34.5 lakh ($41,282) and a reported $2m penalty, respectively, before being granted permission to operate in India again. The identities of the four new applicants have not been disclosed, but officials expect them to go live in the near future.
With the approval of KuCoin and Binance, the number of registered crypto entities in India is set to increase from 46 to 48. Last year, several exchanges including Huobi, Kraken, Gate.io, Bittrex, Bitstamp, MEXC Global, and Bitfinex were banned, leading to a decline in the Indian crypto industry as users turned to foreign exchanges.
In a bid to comply with regulations and enhance its reputation in the Indian market, Binance has stopped accepting cash payments for cryptocurrency trades between users in India. This move aims to align with regulations and standards, although it limits the previously available payment option of cash versus bank transfer for crypto transactions.
India has been working towards regulating the crypto industry by mandating cryptocurrency companies to collect Know Your Customer (KYC) data and register with the FIU. These regulations apply to all Virtual Asset Service Providers (VASPs) operating in India, regardless of their physical location. By requiring FIU registration and compliance with the Prevention of Money Laundering Act (PMLA), India aims to integrate the crypto sector into the existing financial system and establish a framework for monitoring and regulation.
Despite concerns from the crypto community, Nirmala Sitharaman has been retained as the finance minister by Prime Minister Narendra Modi, who has been re-elected for a third term with coalition support. Sitharaman’s view that cryptocurrencies cannot function as actual currencies has drawn mixed reactions, although she has emphasized the need for international cooperation in shaping crypto policies.