The Financial Intelligence Unit in India (FIU-IND) fined Binance, the world’s largest cryptocurrency exchange, Rs. 18.82 crore for failing to meet with anti-money laundering demands
The exchange violated local rules under India’s Prevention of Money Laundering Act (PMLA) of 2002.
Rival exchange KuCoin restarted operations after paying a smaller penalty, demonstrating the importance of regulatory compliance.
In a recent event, the Financial Intelligence Unit of India (FIU-IND) imposed a massive Rs 18.82 crore penalty on the exchange, the world’s largest cryptocurrency exchange. This punishment is the result of Binance operating in India without following domestic anti-money laundering rules. Let us go into the details.
Binance: Case Background
Several offshore exchanges faced scrutiny earlier due to non-compliance with local regulations under the Prevention of Money Laundering Act (PMLA) 2002. Binance was among these exchanges, and the FIU-IND took action against them
The Charges on Binance
After reviewing written and spoken submissions, the FIU-IND confirmed the charges against this exchange. As a result, the exchange received a hefty penalty of Rs 18.82 crore. The exchange must now diligently adhere to Chapter IV of the PMLA 2002 and the PMLA Maintenance of Record Rules (PMLA Rules) of 2005. These regulations seek to stop money laundering and terrorism financing by demanding transaction records
Kucoin’s contrast
Interestingly, competing exchange KuCoin was permitted to resume operations after paying a smaller penalty of Rs 34.5 lakh. Unlike Binance, KuCoin successfully registered with the FIU-IND, demonstrating its commitment to compliance.
Conclusion
The big amount released on Binance serves as a reminder for other virtual digital asset service providers, including cryptocurrency exchanges, to follow anti-money laundering legislation. As the bitcoin ecosystem evolves, regulatory compliance remains important to long-term success.
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