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Binance to Pay INR 18.82 Crore Fine To Restart India Operations In April, it reinstated its India operations along with crypto exchange KuCoin on the condition of paying a penalty after a hearing with the FIU

By Paromita Gupta

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Binance

On Thursday, the Financial Intelligence Unit (under the Department of Revenue) imposed a penalty on Binance for providing services to Indian clients without adhering to the nation's anti-money laundering rule.

In December, Binance along with eight other offshore cryptocurrency exchanges were issued showcause notices by Indian authorities. In January, they were removed from India for "operating illegally."

In April, it reinstated its India operations along with crypto exchange KuCoin on the condition of paying a penalty after a hearing with the FIU.

"After considering the written and oral submissions of the Binance, Director, FIU-IND,
based on the material available on record, found that the charges against Binance were substantiated," the notice read.

The FIU further imposed a fine of INR 18.82 crore on the Richard Teng-headed company. Notably, KuCoin was fully registered and became operational after paying a penalty fee of INR 34.5 lakh.

"The developments we are observing with FIU-IND related to Binance are very organic and are a significant pointer towards India's progress on regulating the digital assets markets in India. A common regulation for all stakeholders and businesses - local and global - would ensure a level playing field for industry players and would provide equal growth opportunities to all the relevant stakeholders of the industry," said Manhar Garegrat, Country Head India & Global Partnerships, Liminal Custody.

"FIU-IND has emphasized that the compliance framework under the Prevention of Money Laundering Act (PMLA) applies to Virtual Digital Asset Service Providers (VDA SPs) serving Indian users, regardless of their domicile. The obligations are activity-based rather than dependent on physical presence in India, highlighting the objective to track and trace fraudulent activities effectively," said Dilip Chenoy, Chairman, Bharat Web3 Association.

"Sustained efforts by FIU-IND will lead to a fertile ground for Web3 businesses to grow and enable India to become a $1 trillion digital economy. Virtual Digital Asset service providers (VASPs) in India must collaborate to create a growth-oriented ecosystem for the digital asset industry," said Shivam Thakral, CEO, BuyUcoin.

Paromita Gupta

Entrepreneur Staff

Features Writer with Entrepreneur India

Covering news and trends in AI and Metaverse segments. An avid book reader running her personal blog on the side. You may reach me at paromita@entrepreneurindia.com. 
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