India, following moves that surprised the crypto world, is now seeing the world’s largest crypto exchange, Binance, facing a notable decline as Indian investors migrate away from the platform. This situation emerged as a result of regulatory pressure from the Indian Financial Intelligence Unit (FIU), which mandated compliance with the country’s anti-money laundering laws for offshore crypto exchanges. Not surprisingly, the FIU’s pressure led to a rapid increase in the transaction volume of local crypto exchanges in the country.
FIU Cracks Down on Offshore Crypto Exchanges
In a notification published by the FIU at the end of December, the regulatory body declared that nine offshore crypto exchanges, including Binance, were operating illegally in India and violating the country’s anti-money laundering rules that came into effect last year. The regulatory body also invited these cryptocurrencies to comply with these provisions and to resolve the issues at this point.
Following this invitation, the FIU made another move by imposing a ban on accessing the websites of nine offshore crypto exchanges from within the country. Moreover, as of January 12, access to the Binance app was terminated from India on Apple‘s App Store.
The cessation of operations by Binance, one of these nine crypto exchanges, particularly confirmed its status as the most popular exchange in India. This is evident from the tremendous increase in concerns of Indian crypto investors conveyed to Binance’s customer support account on platform X.
In a statement from platform X regarding the developments, Binance explained that the crypto exchange is in strong communication with regulators to comply with laws in countries, protect users, and promote a developing Web3 industry.
Exit of Binance from India Boosts Local Crypto Exchanges
According to data, shortly after Binance ceased its operations in India, the transaction volume of local crypto exchanges in the country increased significantly. Leading local exchanges like WazirX and CoinDCX began to attract a large number of users following Binance’s suspension of activities in the country.
Experts point out that Binance is working to resolve its ongoing issue with the FIU and consider that it may be able to restart its operations in the country. Statements from Binance on platform X confirm these claims.
