Apple’s App Store in India has taken action against several major cryptocurrency exchange apps, including Binance, KuCoin, Bitget, Huobi, OKX, Gate.io, and MEXC.
This move comes weeks after the Indian government issued a noncompliance notice to nearly a dozen offshore crypto exchanges, affecting their accessibility to new users in India.
The catalyst for this ban was a notice issued by the Indian Ministry of Finance’s Financial Intelligence Unit (FIU) back in December. The FIU’s notice targeted a range of prominent crypto exchanges such as Binance, Kraken, Kucoin, Bittrex, Gate.io, Bitstamp, Bitfinex, and MEXC Global, alleging that they are operating illegally in India and failing to comply with the Prevention of Money Laundering Act.
The FIU had also recommended that the Ministry of Electronics and Information Technology block the websites of these exchanges due to their noncompliance.
Despite Apple’s App Store’s ban, these crypto exchange apps remain accessible to users in India through Google’s Play Store and their respective web versions. This partial accessibility indicates a varied approach to the enforcement of the FIU’s directives across different platforms.
In response to the recent bans, Sumit Gupta, founder of the Indian crypto exchange CoinDCX, took X (formerly Twitter) to outline a plan for investors who might be seeking to transition from the affected noncompliant offshore exchanges to compliant Indian exchanges.
[Community Update] Amidst the changing landscape of Indian VDA, where offshore exchange apps are now facing restrictions due to government directives, CoinDCX acknowledges the community’s apprehensions. This is a defining moment for VDA in India, and we’re dedicated to… pic.twitter.com/uTpxGqsHk0
— Sumit Gupta (CoinDCX) (@smtgpt) January 10, 2024
This action is part of India’s ongoing efforts to bring cryptocurrencies under the ambit of anti-money laundering and counter financing of terrorism frameworks. As of now, 31 crypto firms have registered with the FIU, but several offshore entities catering to Indian users have not complied with these regulations.
While India-based crypto exchanges like CoinSwitch Kuber, CoinDCX, and WazirX apply rigorous know-your-customer verifications, similar compliance is not always observed by many global platforms. This discrepancy has led to a big shift in trading volumes, with some Indian traders moving to these international apps.
Trading cryptocurrencies in India is not explicitly illegal, and individuals and businesses were actively participating in the crypto market. Regarding taxation, India did impose a tax on cryptocurrency transactions. The tax rate on cryptocurrency gains was subject to the individual’s income tax bracket, which could be as high as 30%. The lack of clear regulations has led to concerns about criminal activities involving cryptocurrencies, prompting calls for regulatory clarity in the country.
