Google has joined Apple in removing several cryptocurrency exchange apps, including Binance and Kraken, from the Play Store in India.
This action follows the Financial Intelligence Unit (FIU) of the Indian Finance Ministry issuing show-cause notices to these exchanges, citing concerns about unauthorized operations and violations of anti-money laundering regulations in India.
The FIU has targeted nine offshore crypto exchanges, urging the Ministry of Electronics and Information Technology (MeitY) to block their URLs within the country. This move reflects India’s stringent regulatory approach to cryptocurrencies, which has undergone fluctuations, including a previous ban by the Reserve Bank of India, later overturned by the Supreme Court.
The impact on the Indian crypto market is significant as regulatory issues plague the industry. Removing these apps from major digital platforms exacerbates the challenges faced by the Indian crypto industry, which is already grappling with a regulatory environment that includes a 30% capital gains tax and a 1% transaction levy on cryptocurrencies.
The crackdown has added to the hurdles faced by the country’s web3 aspirations. Stringent regulations have already contributed to a noticeable decline in trading activity on local crypto platforms.
Compliance with India’s anti-money laundering rules is at the core of the issue. While domestic exchanges have adhered to strict identification verification processes, offshore counterparts have faced scrutiny for non-compliance. This has resulted in domestic traders seeking less stringent platforms on global exchanges, highlighting a case of regulatory arbitrage and potential tax avoidance.
The recent actions by tech giants Google and Apple, aligning with directives from the Indian government, highlight the precarious position of cryptocurrency trading in the country. Enforcement actions against offshore exchanges emphasize the importance of adherence to regulatory norms and consumer protection measures for the Indian crypto market to thrive. For more updates, follow the IncBasil Website.
