India is significantly tightening regulatory control over its cryptocurrency industry. According to a new report from the country's Financial Intelligence Unit (FIU-IND), 49 cryptocurrency exchanges have completed mandatory anti-money laundering (AML) registration during the 2024-25 financial year. Of these, 45 are domestic Indian exchanges, while four are offshore platforms.
The report underscores a strong enforcement stance. In the last financial year, authorities imposed penalties totaling INR 2.8 billion (approximately $33.6 million) on crypto platforms that failed to comply with India's AML regulations. These fines primarily targeted exchanges that neglected to register, report transactions, or adhere to customer verification (KYC) requirements.
Registration with the FIU-IND is now a prerequisite for legal operation in India. Following registration, platforms must implement strict KYC procedures, monitor transactions, and report any suspicious activity. While these rules increase operational costs, they provide registered exchanges with legal clarity and the ability to serve Indian users without fear of sudden bans.
The inclusion of four offshore exchanges highlights India's push to enforce its laws on global firms. Previously, India blocked website and payment access for non-compliant foreign platforms, prompting some to exit the market. The recent registrations indicate that others are choosing to comply, recognizing India as a key crypto market despite its strict regulatory environment and high taxes.
The FIU-IND's actions send a clear message: India is not banning cryptocurrency but is establishing a framework of stringent rules. The growing number of registrations suggests the industry is adapting, while the substantial fines demonstrate that enforcement will remain rigorous. Compliant exchanges may gain user trust, but regulators are expected to increase monitoring further, moving the sector toward greater oversight and accountability.
