Crypto Exchanges

Context (TH): FIU issued Binance and other crypto exchanges with show-cause notices.

Financial Intelligence Unit (FIU)

FIU was established in 2004 as an anti-money laundering unit under the Finance Ministry.
It investigates monthly Cash transaction reports, Suspicious transaction reports and Cross-border wire transfer reports under the Prevention of Money Laundering Act, 2002 (PMLA).
Suspicious or doubtful transactions are shared with agencies like the Enforcement Directorate, the Central Bureau of Investigation and the Tax Authority.

A cryptocurrency exchange works similarly to stock exchanges, which helps investors buy and sell in digital currencies such as Bitcoin, Ethereum, or Tether.
These platforms work on digital marketplaces such as mobile apps or via desktop functions.
India will block URLs of 9 offshore exchanges, including Binance, after issuing ‘Show Cause’ notices.
The Finance Ministry mandated that crypto businesses register with the FIU and comply with the PMLA.
Crypto businesses will become legally obligated to perform Know Your Customer (KYC).
The obligation is activity-based and not physical presence-based.