Binance eyes return to India as an FIU-compliant platform

Two sources familiar with the development claim that the exchange has agreed to pay a $2 million penalty to the regulator for non-compliance. However, they did not confirm how the fine has been calculated.

India, according to a Chainalysis report, is one of the fastest-growing crypto economies, with the highest adoption rate as of 2023. With its re-entry, Binance will become the second FIU-compliant foreign cryptocurrency exchange to tap into this market, closely following KuCoin.

Prior to being banned in January, Binance reportedly accounted for more than 90% of the Indian crypto trading volume. The surge in popularity was primarily driven by traders trying to bypass tax implications imposed by the Indian government.

Global cryptocurrency exchanges not registered in India were reportedly causing INR 3000 crores (approx. USD 361.45 million) in tax leakage annually. This was one of the key motivators for the FIU to ban unregistered foreign exchanges in the nation.

One of the sources familiar with the matter was quoted saying that it is “unfortunate that it took (Binance) more than two years to realize there is no room for negotiations, and (that) no global powerhouse can command special treatment, especially at the cost of exposing the country’s financial system to vulnerabilities.”