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The affected cryptocurrency exchanges have responded cautiously, stating their commitment to comply with local laws while minimizing disruptions to their services.
Apple has recently made a big decision to block certain popular cryptocurrency exchange apps from its App Store in India. This choice was influenced by the increasing regulatory pressure from Indian authorities who are demanding that these exchanges properly register with financial regulators within the country.
The Financial Intelligence Unit (FIU) of India’s Ministry of Finance sent a notice in late December that affected well-known exchanges like Binance, Huobi, Kraken, KuCoin, Bitstamp, Gate.io, MEXC Global, Bittrex, and Bitfinex. These notices accused the exchanges of operating illegally without the necessary registrations and mandated that they must register as reporting entities and comply with all tax filing and information-sharing requirements. If they fail to comply, their websites could be blocked throughout India.
In response, Apple has prohibited the applications from these exchanges, which means that new users in India can no longer download them from the App Store. However, existing users can still access the exchanges through web browsers, Google’s Play Store, or previously downloaded apps.
This ban has raised concerns among Indian cryptocurrency investors who heavily relied on these offshore platforms to avoid the high 30% tax and additional trading fees imposed by India. As a result, trading volumes on domestic exchanges have significantly decreased due to the limited affordable trading options.
This recent crackdown by Indian regulators reflects the country’s complex relationship with cryptocurrency and its efforts to establish strict global regulations. India has also emphasized the need for international collaboration in creating a regulatory framework. However, domestically, the progress of parliamentary bills on cryptocurrency regulations has stalled, leaving the country’s cryptocurrency community seeking balanced regulations.
The affected cryptocurrency exchanges have responded cautiously, stating their commitment to comply with local laws while minimizing disruptions to their services. Binance, for instance, acknowledged the ban but reassured its current Indian users that its services remain unaffected for now. The exchange expressed a collaborative approach to resolving regulatory disputes through open communication.
We are aware of new changes that have been introduced regarding crypto exchanges on the iOS App Store in India, impacting the Binance App.
The ongoing situation is not unique to #Binance and we remain committed to complying with local regulations and maintaining dialogue with…
— Binance South Asia (@BinanceDesi) January 10, 2024
Lack of Compliance with Regulatory Requirements Will Retard Crypto Adoption
It is important to note that, at present, the ban only applies to Apple’s iOS App Store and does not affect Android’s Google Play store or web access. However, the removal of these apps indicates the increasing regulatory pressures that may extend to other platforms if the exchanges fail to comply. These bans also foreshadow the possibility of other countries following India’s lead in demanding local registrations as cryptocurrencies gain mainstream acceptance.
Overall, Apple’s bans mark a significant development in India’s ongoing efforts to regulate cryptocurrencies. However, they should serve as a catalyst for constructive dialogue between regulators and exchanges to strike a balance between innovation, taxation, investor protection, and other important factors.
By engaging with each other and being open to communication, it is possible to establish practical regulations for cryptocurrencies without restricting access or hindering the significant economic opportunities that decentralized technologies offer. However, if cryptocurrency exchanges refuse to be transparent and comply with regulations, it may lead to more strict actions from regulators and slow down the adoption of cryptocurrencies in India and other parts of the world.