FIU-India to Lift Ban on Binance After Due Diligence: Top Government Official

The Financial Intelligence Unit-India (FIU-India) is set to lift the ban on the world’s largest crypto exchange, Binance, after completing due diligence, according to a top government official. This decision comes after the agency lifted the ban on another offshore crypto exchange, KuCoin, in March.

Vivek Aggarwal, director of FIU-IND and additional secretary in the Department of Revenue, stated that Binance’s operations have not yet resumed, and the penalty is yet to be decided. Binance has completed the initial registration with FIU-IND, but the penalty and compliance proceedings are still ongoing.

The registration of Binance follows the signing up of rival KuCoin in March, while OKX decided to discontinue its services in India from April 30. In December 2023, nine offshore exchanges, including Binance, KuCoin, and OKX, were found to be not registered under FIU-IND and not aligned with the provisions of the Prevention of Money Laundering Act (PMLA) of 2002.

The government had previously ordered to block the URLs of these exchanges in India and delisted their apps from Apple and Google’s app stores. Virtual digital asset service providers, whether operating within or outside India, must register with FIU India as a ‘Reporting Entity’ and adhere to the requirements mandated under the PMLA of 2002.

In related news, Changpeng Zhao, the former chief executive of Binance, was sentenced to four months in prison for violating US laws against money laundering. This follows a recent statement by Union Finance Minister Nirmala Sitharaman highlighting the risks associated with unregulated crypto, such as terror funding and drug financing.

Additionally, the price of bitcoin fell sharply on May 10, reversing a climb that had seen it reach $63,500. The drop was attributed to disappointing US economic data and hawkish remarks from Dallas Fed President Lori Logan. This news comes as G20 countries endorsed recommendations for the regulation of crypto-assets and global stablecoin arrangements.