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Apple's Response to Regulatory Directives
In a significant move, Apple has removed several offshore cryptocurrency exchanges, including Binance, Kucoin, and OKX, from its App Store in India. This action comes in response to a show-cause notice issued by India's finance ministry to nine virtual digital asset (VDA) service providers. The notice, sent on December 28, highlighted the exchanges' failure to comply with India's money laundering laws and tax regulations.
Finance Ministry's Crackdown on Offshore Exchanges
The finance ministry's directive was aimed at exchanges that have been operating in India without proper registration and adherence to local tax rules. Among the affected are prominent platforms like Binance, Kucoin, Houbi, Kraken, and several others. This measure aligns with the government's efforts to regulate the crypto market and ensure compliance with anti-money laundering and countering the financing of terrorism (CFT) guidelines under the Prevention of Money Laundering Act (PMLA).
Impact on the Crypto Market in India
The removal of these apps from Apple's App Store, though not yet mirrored on Google’s Play Store, represents a significant shift in the accessibility of offshore crypto exchanges in India. This move comes at a time when a large number of Indian investors have been turning to offshore exchanges to bypass stringent tax laws on cryptocurrency transactions and income.
Binance's Response to the Situation
In response to the removal, Binance assured its users on X (formerly Twitter) that existing app users would not be impacted and that their funds would remain secure. The company emphasized its commitment to compliance with local regulations and ongoing dialogue with regulators worldwide.
CoinDCX's Initiative for Stranded Users
To capitalize on the situation and attract users of these offshore platforms, CoinDCX's co-founder Sumit Gupta announced the launch of a $1-million Treasury Fund, offering bonuses to users who transfer their VDAs to CoinDCX.
The Larger Picture: Regulatory Compliance and Consumer Protection
This development underscores the Indian government's intent to bring offshore exchanges under the same compliance framework as domestic platforms. Ashish Singhal, Co-founder and Group CEO of PeepalCo & CoinSwitch, pointed out that this move aims to create a level playing field, strengthen compliance guardrails, and enhance consumer protection.
A Shift in the Crypto Landscape
Apple's decision to remove these crypto exchange apps from the Indian App Store marks a pivotal moment in the country's approach to cryptocurrency regulation. It highlights the government's efforts to ensure that all exchanges operating within its jurisdiction comply with local laws and norms, signaling a more regulated and secure crypto environment for Indian investors.