Several cryptocurrency exchanges, including Binance, Kraken, Mexc, and Kucoin, are no longer found in Apple's App Store in India, raising questions about the reasons behind their removal.
An illustration picture taken in London on May 8, 2022, shows gold plated souvenir cryptocurrency Tether (USDT), Bitcoin and Etherium coins arranged beside a screen displaying a trading chart. Tether (USDT) is an Ethereum token known as a stablecoin that is pegged to the value of the US dollar, and is currently the largest stablecoin with a market value of USD 83 billion dollars.
Crypto Firms Allegedly Operating Illegally in India
According to TechCrunch, this development comes less than two weeks after these global crypto firms were flagged for allegedly operating "illegally" in the country.
The Financial Intelligence Unit (FIU), an Indian government agency overseeing financial transactions, issued show cause notices to nine crypto firms, claiming non-compliance with India's anti-money laundering rules.
In late November, the FIU requested India's IT Ministry to block the websites of all nine cryptocurrency services operating in the country. Among the affected exchanges are Huobi, Gate.io, Bittrex, and Bitfinex. However, Bitstamp, another exchange mentioned by the FIU, remains accessible on the App Store in India.
Despite removing these apps from Apple's App Store, they are still available on the Google Play Store in India, and their respective websites remain accessible.
This action reflects a growing trend among Indian traders who are turning to global cryptocurrency platforms, possibly in an effort to evade taxes imposed by India since the previous year. The country introduced a 30% tax on gains and a 1% deduction on each crypto transaction.
Unlike many global platforms, local exchanges such as CoinSwitch Kuber, CoinDCX, and WazirX have continued to enforce stringent know-your-customer verifications.
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India's PMLA
Ashish Singhal, CEO of CoinSwitch, stressed the importance of complying with India's Prevention of Money Laundering Act (PMLA) and suggested that offshore exchanges should register with the FIU-IND.
He emphasized the need for adherence to India's anti-money laundering (AML) and countering the financing of terrorism (CFT) measures. Singhal argued that this would bolster consumer protection in India by subjecting offshore exchanges to greater regulatory oversight.
Indian cryptocurrency exchanges, including CoinDCX and CoinSwitch Kuber, had previously warned the government that its taxation policy could prompt users to shift to decentralized exchanges or seek non-compliant services.
In light of these changes, CoinDCX revealed Tuesday its decision to provide incentives to users who transfer their cryptocurrency holdings from international exchanges to its platform based in India.
TechCrunch reported that India has a track record of adopting a stringent position on cryptocurrencies. About five years ago, the Reserve Bank of India imposed a cryptocurrency ban in the country, a measure later overturned by the Supreme Court.
Despite this, the central bank continues the call for prohibiting cryptocurrencies, drawing parallels between virtual digital assets and Ponzi schemes. Coinbase, a global cryptocurrency exchange, halted the onboarding of new customers in India last year, attributing its decision to "informal pressure" from the central bank.
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