CoinDCX, WazirX, Coinswitch, CoinswitchX, and Zebpay are among the entities that have registered with the Financial Intelligence Unit-India so far
In March, the government notified that companies dealing in VDAs, crypto exchanges and related intermediaries would be considered ‘reporting entities’ under the PMLA
Offshore crypto exchanges working in India are also required to adhere to the guidelines
As many as 28 entities providing services related to virtual digital assets (VDAs) have registered with the Financial Intelligence Unit-India (FIU-IND), the government said.
Responding to a question in the Lok Sabha, the government said that Neblio Technologies (CoinDCX), Zanmai Labs (WazirX), Bitcipher Labs (Coinswitch), Nextgendev Solutions (CoinswitchX), and Awlencan Innovations India (Zebpay) are among the entities that have registered with FIU-IND so far.
In March, the government notified that companies dealing in VDAs, crypto exchanges and related intermediaries would be considered ‘reporting entities’ under the Prevention of Money Laundering Act (PMLA). In line with the notification, crypto exchanges and their intermediaries are required to also perform KYC of their clients and platform users.
As reporting entities under the PMLA, crypto exchanges and VDA companies have to maintain KYC details or records of identity documents of their users and clients, along with account files and business correspondence with its clients.
Offshore crypto exchanges working in India are also required to adhere to these guidelines. “The guidelines and reporting requirements are applicable to offshore crypto exchanges servicing the Indian market. The process of registration for the said VDA service providers has been initiated,” Minister of State for Finance Pankaj Chaudhary said.
Appropriate action under the PMLA shall be initiated in cases of non-compliance by foreign platforms, he added.
Besides regulatory compliances, the government’s taxation of VDAs, including cryptos, have wreaked havoc in the Indian crypto market. The government’s decision to levy 1% tax deducted at source (TDS) on crypto transactions above INR 10,000 and 30% tax on profits from these transactions have pumelled crypto trade.
The strong criticism of cryptocurrencies and calls to ban them by the top officials of the Reserve Bank of India (RBI) have further dampened the sentiment. To add to this, the collapse of giants such as FTX only made matters worse for India’s crypto industry.