Quick Take:

• Binance and KuCoin registered with India’s Financial Intelligence Unit (FIU).
• KuCoin pays $41,000 fine; Binance’s penalty pending FIU hearing.
• Offshore crypto entities banned in India include Binance, KuCoin, Huobi, Kraken, and others.
• KuCoin resumes operations; Binance awaits FIU decision on penalty.

India’s Financial Intelligence Unit (FIU) has approved the registration of Binance and KuCoin, two major cryptocurrency exchanges, marking the first instance of offshore crypto entities gaining approval from the country’s anti-money laundering authority.

Binance, recognized as the world’s largest cryptocurrency exchange, and its competitor KuCoin received registration confirmation from the FIU, an agency operating under the nation’s Finance Ministry, according to a senior official of the unit speaking to CoinDesk.

While KuCoin has paid a fine of $41,000 and resumed its operations, Binance’s financial penalty is yet to be determined pending a hearing with the FIU. Both exchanges were among the nine offshore entities previously banned in India, a list that included Huobi, Kraken, Gate.io, Bittrex, Bitstamp, MEXC Global, and Bitfinex.

KuCoin’s prompt payment of the penalty has allowed it to resume its activities within the Indian market. However, Binance remains in a state of operational pause until the FIU concludes its hearing and determines the appropriate penalty.

The FIU official overseeing the registration process confirmed, “Binance is registered but the compliance proceedings are not completed because the amount of penalty has to be decided by me and that hearing is still going on.”

As regulatory scrutiny intensifies globally, especially in jurisdictions like India where cryptocurrency regulations are evolving rapidly, compliance with anti-money laundering (AML) and know-your-customer (KYC) regulations becomes paramount for crypto exchanges. The registration of Binance and KuCoin with India’s FIU signifies a step towards regulatory alignment within the country’s crypto landscape, albeit with ongoing compliance proceedings.

The outcome of Binance’s FIU hearing and the subsequent penalty determination will be closely watched by industry participants, as it may set a precedent for how offshore crypto exchanges navigate regulatory challenges in India and beyond. Amidst these developments, maintaining transparency, robust compliance frameworks, and open dialogue with regulatory authorities will remain crucial for exchanges seeking to operate in compliance with evolving regulatory standards.