India Steps Up Campaign Against Foreign Cryptocurrency Exchanges

India has intensified its campaign against foreign cryptocurrency exchanges operating without local licenses, as it has asked Apple to remove encryption platform apps from its store in India, including the “Binance” app.

“Bitfinex, HTX, and Kucoin, which are among eight cryptocurrency platforms, no longer have their applications available on Apple’s store in India. These apps were removed based on instructions from the Indian Ministry of Electronics and Information Technology, according to anonymous sources who requested anonymity as the instructions were not publicly announced.”

This step represents a significant escalation of India’s campaign against foreign cryptocurrencies platforms like “Binance”, which started on December 28th when authorities notified nine exchanges that they were suspected of misconduct. Indian cryptocurrency trading companies have already begun transferring their deposits to local exchanges that comply with the country’s regulations, out of fear of losing access to their funds.

The authorities have also asked Alphabet subsidiary Google to remove encryption applications. Google Play in India still displays platform applications that have been removed from Apple’s App Store as of 2 PM local time today, Wednesday. Apple, Google, and the Indian Ministry of Technology have not responded to requests for comment.

The Indian financial intelligence unit issued compliance notices to nine external platforms on December 28, banning the websites of encryption platforms. It also requested the Ministry of Information to specifically block the unified resource locator (URL) of these platforms. The financial intelligence unit stated at the time that the exchanges were operating illegally in India without adhering to anti-money laundering laws.

Access to these websites from India is still possible. Among the exchanges included in this announcement, only the “Bitstamp” platform is still available for download on the local app store today. Of the two versions offered by the “Kraken” platform in the United States, only the “Pro” version was available. Binance, the largest cryptocurrency exchange, has faced intense regulatory pressures worldwide, accusing it of targeting local users without a license. India is among a number of countries, including Belgium and Australia, taking steps to ban the platform, which says it has no global headquarters. In November, it agreed to pay $4.3 billion after admitting guilt in the United States on charges of money laundering and sanctions violations.

A spokesperson for Binance stated via email, “This situation is not unique to Binance, and also affects some other Web3 industry applications. We are working diligently to enrich the constructive policy-making process that aims to benefit every user and all market participants” according to Al-Sharq Business.

On its part, the formerly known company “Huobi”, now called “HTX”, stated that it does not have any operations in India. Both “Bitfinex”, “Kucoin”, “Bitstamp”, and “Kraken” did not respond to requests for comment on the matter.

Last year, the Indian government imposed regulations on cryptocurrency money laundering while tightening control on digital assets alongside other countries. In 2022, the government dealt a heavy blow to local cryptocurrency exchanges by implementing a tax on transactions, causing a decrease in trading volumes. Local exchanges complained that the 1% tax, known as the tax deducted at source, forced Indian cryptocurrency trading companies to rely on untaxed external platforms, leading to greater damages to their revenue. Sumit Gupta, the CEO of CoinDCX, stated in October last year that 95% of trading volumes had shifted to external entities.