Benzinga - Editor’s note: This story has been updated with comments from Binance.
India’s Financial Intelligence Unit (FIU) has levied a fine of 188.2 million rupees ($2.25 million) on Binance, the world’s largest cryptocurrency exchange, for violating local anti-money laundering regulations.
What Happened: The Indian government mandates that virtual digital asset service providers, including crypto exchanges, must register with the FIU as reporting entities and adhere to its stringent anti-money laundering policies.
Binance has responded to Benzinga’s request for comment with the following statement:
“We are aware of the FIU’s order and are reviewing it now to determine next steps. We are grateful to have the opportunity to continue our mission to serve the vibrant Indian crypto community. We wish to work with the FIU as a reporting entity and we are enthusiastic about reentering the Indian market to contribute positively, should we be able to do so in the near future. We remain dedicated to maintaining transparency, fostering cooperation, and ensuring compliance with regulatory authorities.”
In an effort to resume operations in India, Binance registered with the FIU in May, following the watchdog’s issuance of show-cause notices to nine offshore exchanges that were found to be operating without compliance with local laws.
The FIU also requested the Ministry of Electronics and Information Technology to block online access to these non-compliant exchanges.
In a similar situation, the crypto exchange KuCoin registered with the FIU in March but incurred a smaller penalty of 3.45 million rupees.
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Why It Matters: The scrutiny on Binance is not limited to India.
In May, Canada's anti-money laundering agency imposed a fine of $4.38 million on the exchange for breaches of its anti-money laundering regulations.
Additionally, Binance’s former CEO, Changpeng Zhao, faced legal repercussions in the United States.
In May, U.S. District Judge Richard Jones in Seattle sentenced Zhao to four months in prison after he pleaded guilty to violating the country’s anti-money laundering laws.
As the global regulatory landscape tightens around cryptocurrency operations, these developments highlight the increasing scrutiny and enforcement actions against major crypto exchanges.
What’s Next: This trend and its implications for the future of digital assets will be a focal point at Benzinga’s Future of Digital Assets event on Nov. 19, offering critical insights into the evolving regulatory environment and its impact on the crypto market.
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