Binance and KuCoin Gain Approval from Indian Regulator after Ban, Paving Way for Industry Guidelines

Binance and KuCoin, two major cryptocurrency exchanges, have become the first offshore entities to receive approval from India’s Financial Intelligence Unit (FIU). This follows a ban imposed on these platforms last year due to alleged non-compliance with local rules. While both companies have been registered with the FIU, Binance is still awaiting a penalty decision following a hearing with the unit. Meanwhile, KuCoin has already paid a fine of $41,000, making it the first crypto entity to do so. The move represents a significant shift in credibility for the sector in India, according to Vivek Aggarwal, head of FIU-IND. Furthermore, India now has around 48 crypto entities registered as reporting entities under its Anti-Money Laundering Act, with the FIU planning to establish a working group with the industry to establish guidelines for virtual digital asset service providers. However, the registration process does not require foreign entities to have an office in India, although a principal compliance officer must be registered along with their address and other relevant details. Those who failed to win registration by the deadline and received a show cause notice in December remain prohibited, regardless of whether they have initiated discussions with the FIU. Overall, the FIU aims to maintain complete visibility over transactions and receive reports of suspicious activities, in line with anti-money laundering and counter-terrorism framework requirements.