India Registers 49 Crypto Exchanges, Imposes ₹2.8 Billion Penalties

India’s Financial Intelligence Unit (FIU-IND) confirmed that 49 cryptocurrency exchanges completed anti-money laundering registration for FY 2024–25. Of these, 45 are domestic, while four are offshore platforms. The registrations integrate Virtual Digital Asset (VDA) service providers under the Prevention of Money Laundering Act.

This will ensure that the exchanges have active monitoring of transactions and notification of suspicious transactions to the relevant authorities. The development will help tighten regulation of the crypto market in the Indian market, which continues to grow. The registered exchanges will have records of wallet ownership.

Cash movements between host and non-host wallets also receive close attention. The FIU system is meant to eliminate any criminal activities related to fund movements and increase transparency. The law covers all VDAs, which show that the government is exercising strong control over digital finances.

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Suspicious Transactions Draw Strategic Attention

According to the FIU’s annual reports, the monitoring of suspicious activities has been highlighted as important each year. The use of crypto funds has been on the increase in hawala activities, illegal gaming, and fraud. The FIU identified an illegal adult site through VDA activity. The results highlighted the two-edged nature of the crypt market.

In order to maintain compliance, the FIU imposed a penalty of INR 2.8 billion on the said entities in the last year. There are stiff penalties for the non-compliant exchanges. These exchanges are required to establish the ownership pattern in order to identify the irregularities.

Offshore Exchanges Face Increased Scrutiny

An FIU report highlights the division of the market for the Indian market into compliant and non-compliant exchanges. Five large offshore platforms, including Binance and Coinbase, managed registration. However, 25 offshore platforms, including BitMEX and LBank, have been banned since October 2025. These cannot operate in the market until registration requirements are met.

This enforcement has resulted in Indian retail volumes being concentrated in regulated premises. Every platform will now be required to appoint a designated director and a principal officer for liaising with the government. The FIU has planned tougher measures for 2026, where there will be risk assessments and screenings for sanctions. It is expected that India will be one of the most regulated jurisdictions in the world for trading digital assets.

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