- The FIU investigates cryptocurrency transactions associated to fraud, fraud, playing networks and critical felony exercise.
- Non-compliant crypto platforms have been fined Rs 28 million in 2024-25 for AML violations.
- Authorities are constructing intelligence on buying and selling hotspots and high-risk digital property.
India is accelerating regulation of the cryptocurrency sector as enforcement companies concentrate on monetary crime dangers related to digital property.
Throughout the 2024-2025 monetary yr, 49 digital foreign money exchanges will probably be formally registered with the Monetary Intelligence Service, a decisive step in the direction of strengthening anti-money laundering and terrorist financing laws.
The transfer displays a broader regulatory recalibration as authorities reply to rising proof of cryptocurrency abuse and develop oversight throughout platforms working within the nation.
This regulatory change has additionally sparked widespread debate inside the home cryptocurrency ecosystem.
A current publish on X by CoinDCX CEO Sumit Gupta drew consideration to the escalating compliance atmosphere as exchanges more and more function beneath the supervision of FIUs.
The publish went viral as registration, monitoring and enforcement grew to become central themes of India’s crypto coverage in the course of the monetary yr.
FIU warns of threat of exploitation
The Press Belief of India reported that an investigation into suspicious transaction experiences filed by crypto platforms in the course of the fiscal yr 2024-2025 revealed a recurring sample of high-risk actions.
The evaluation discovered that crypto property are related to fraud, fraud, playing networks, unaccounted for funds transfers, and peer-to-peer abuse.
The FIU additionally recognized extra critical dangers, together with hyperlinks to darknet providers, terrorist financing, and youngster sexual abuse materials.
Exchanges beneath one regulatory authority
Of the 49 registered exchanges, 45 are based mostly in India and 4 function abroad.
Not like some jurisdictions the place crypto supervision is break up throughout a number of companies, India has designated the FIU, which operates beneath the Ministry of Finance, as the only authority chargeable for the supervision of crypto exchanges.
Trade leaders say India’s crypto market is extra aggressive than generally realized, with a number of platforms competing for customers and liquidity.
They argue that this aggressive atmosphere can assist innovation if regulatory expectations are clear and utilized persistently to all gamers.
Compliance rule description
Cryptocurrency exchanges in India are categorised as digital digital asset service suppliers and are topic to anti-money laundering legal guidelines from 2023.
As a part of this framework, platforms are required to file suspicious transaction experiences, determine pockets house owners, monitor token fundraising actions resembling IPO-style launches, and monitor transfers between hosted and non-hosted wallets.
After registration, exchanges will even be required to reveal banking relationships, appoint a compliance officer, conduct inside audits, apply risk-based buyer checks, evaluate transactions towards sanctions lists, and conduct common threat assessments.
All related knowledge have to be shared with the FIU to assist ongoing supervision.
coercion and penalties
Registration additionally entails enforcement. A complete of Rs 28 billion in fines has been imposed on crypto platforms for failing to satisfy their anti-money laundering (AML) obligations for the fiscal yr 2024-25.
The FIU additionally mapped regional transaction hotspots, recognized digital property steadily related to criminality, and strengthened the federal government’s broader surveillance and intelligence capabilities.
