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Finance ministry issues notice to 9 offshore crypto platforms, wants MeitY to block URLs – Times of India


The Financial Intelligence Unit (FIU) under the Finance Ministry has issued show cause notices to nine offshore cryptocurrency and virtual digital assets platforms. The show cause notice has been issued for non-compliance with anti-money laundering law. According to a report in news agency PTI, the FIU has also written to the Ministry of Electronics and Information Technology (Meity) to block the URLs of these nine entities that are said to be operating illegally without complying with the provisions of the Prevention of Money Laundering Act (PMLA) 2002 in India.
In March, the government had brought VDA SPs into the ambit of the Anti Money Laundering/Counter Financing of Terrorism (AML-CFT) framework under the provisions of PMLA. FIU-IND is the central, national agency responsible for receiving, processing, analyzing and disseminating information relating to suspect financial transactions to enforcement agencies and foreign FIUs.
Names of the nine entities that have been issued cause notices
The virtual digital assets service providers (VDA SP) who have been issued notice for not registering as reporting entities with the FIU-India are Binance, Kucoin, Huobi, Kraken,, Bittrex, Bitstamp, MEXC Global and Bitfenex.
What the rules say
The virtual digital assets service providers operating in India (both offshore and onshore) and engaged in activities like exchange between virtual digital assets and fiat currencies, transfer of virtual digital assets, safekeeping or administration of virtual digital assets or instruments enabling control over virtual digital assets etc are required to be registered with FIU IND as ‘Reporting Entity’ and comply with the set of obligations as mandated under Prevention of Money Laundering Act (PMLA) 2002.
The obligation is activity-based and is not contingent on physical presence in India.
The regulation casts reporting, record keeping, and other obligations on the VDA SPs under the PML Act which also includes registration with the FIU IND, the finance ministry said.
“As part of compliance action against the offshore entities, Financial Intelligence Unit India (FIU IND) has issued compliance Show Cause Notices to following nine offshore Virtual Digital Assets Service Providers (VDA SPs) under Section 13 of the PMLA,” the ministry said in a statement.
Under the I-T Act, reporting entities are required to file statements of financial transactions (SFT) with the tax department containing details of certain financial transactions or any reportable account maintained by them during the year. Till date, 31 VDA SPs have registered with FIU IND.


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