India’s Financial Intelligence Unit has issued noncompliance notices to 15 crypto platforms and sought the removal of their apps and websites from public access, escalating enforcement against offshore digital asset businesses serving Indian customers without meeting the country’s anti-money laundering requirements.
The Sept. 9 action targets platforms including Weex, Blofin, Bitunix, DigiFinex, WOO X and WhiteBIT. FIU-IND said the companies were operating in India without complying with provisions of the Prevention of Money Laundering Act (PMLA).
The move extends an enforcement approach India has previously used against larger international exchanges, several of which later registered with FIU-IND and restored or expanded services in the country.
Key Takeaways
- FIU-IND issued PMLA non-compliance notices to 15 virtual digital asset service providers.
- Authorities are also seeking to remove the platforms’ apps and website URLs from public access in India.
- The requirements apply to offshore companies serving Indian customers even if they have no physical presence in the country.
- Crypto service providers have been subject to India’s AML and counter-terrorism financing framework since March 2023.
- Previous enforcement against Binance and Bybit eventually resulted in registration after penalties and compliance measures.
FIU Names 15 Crypto Platforms
The Financial Intelligence Unit issued the notices under Section 13 of the PMLA. The 15 platforms named are Weex, Blofin, Rezorex, Bitunix, DigiFinex, Toobit, XT.com, Latoken, WOO X, Pionex, ChangeNow, SimpleSwap, FixedFloat, WhiteBIT and Guardarian. Alongside the compliance action, FIU-IND sought the removal of their applications and URLs from public access in India.
The government announcement did not provide a specific timetable for when individual apps or websites would become inaccessible. The action is therefore a takedown request rather than confirmation that all 15 services have already been blocked.
Under Section 13, FIU-IND has powers to issue warnings, direct reporting entities to take corrective measures and impose monetary penalties for failures to comply with PMLA requirements.
Offshore Platforms Must Register in India
India brought virtual digital asset service providers under its AML and counter financing of terrorism framework in March 2023. The rules cover businesses providing services including exchanges between virtual digital assets and fiat currencies, transfers of digital assets, custody and administration of virtual assets. Crucially for offshore exchanges, the obligations depend on whether a company serves Indian users rather than whether it maintains offices in the country.
Platforms covered by the rules must register with FIU-IND as reporting entities and meet requirements involving customer due diligence, transaction monitoring, record keeping and reporting of suspicious transactions.
The latest enforcement action indicates that operating from outside India does not exempt a platform from those obligations when it targets or provides services to Indian customers.
Previous Crackdowns Led Exchanges to Register
FIU-IND has previously taken similar action against major international crypto exchanges. In December 2023, authorities issued compliance notices to nine offshore platforms, including Binance, KuCoin, Kraken, Bitfinex, Gate.io and others.
Binance subsequently registered with FIU-IND and returned to the Indian market in 2024 after paying a penalty of 188.2 million rupees, approximately $2.25 million at the time, over previous compliance failures.
Bybit also temporarily restricted services for Indian users while completing its registration process. The exchange later paid a 92.7 million rupee penalty and restored services after securing registration.
Coinbase has similarly resumed onboarding Indian users after completing FIU registration. Those cases show that enforcement action does not necessarily amount to a permanent ban. Platforms may have a route back to serving Indian customers if they satisfy registration and compliance requirements.
India Warns Users About Crypto Risks
Alongside the enforcement action, authorities reiterated that virtual digital assets do not have legal tender status in India and warned about the risks associated with crypto products. FIU-IND also noted that crypto products and non-fungible tokens remain outside some aspects of India’s broader regulatory framework, meaning users may not have the same regulatory recourse available for losses as they would with conventional regulated financial products.
At the same time, businesses facilitating virtual digital asset transactions can still be subject to AML obligations even where the underlying assets are not regulated in the same way as traditional securities. That distinction is central to the latest action: India is enforcing rules governing the companies providing crypto services rather than treating the notices as a prohibition on cryptocurrency itself.
Conclusion
India’s move against 15 crypto platforms reinforces its requirement that offshore exchanges serving domestic customers register with FIU-IND and comply with the PMLA.
The immediate focus is access, with authorities seeking removal of the named platforms’ apps and websites. However, previous cases involving Binance and Bybit show that registration and compliance can provide a path back into the Indian market. Whether the latest 15 platforms follow that route or withdraw from India will determine the longer term impact of the crackdown on their users.
