OKX terminates its services in India, asking users to withdraw funds by April 30

OKX was one of nine foreign cryptocurrency exchanges blacklisted in India after local regulators issued compliance notifications.

OKX cryptocurrency exchange is ceasing operations in India over three months after the Indian Ministry of Finance’s Financial Intelligence Unit (FIU) issued compliance notifications to nine global crypto exchange operators.

In a warning addressed to Indian consumers on March 21, OKX requested users to terminate their accounts and redeem cash before April 30. The cryptocurrency exchange cited local regulatory constraints as the primary reason for its decision. 

The FIU requested that the Ministry of Electronics and Information Technology disable the websites of the informed cryptocurrency exchanges within two weeks of receiving notice. OKX adopted a new registration process with rigorous Know Your Customer checks after authorities stopped its website and application in January; yet, the exchange’s notification to users indicates that it will no longer operate in India.

Despite being a thriving market, India remains difficult for foreign crypto exchanges to traverse due to a lack of clear regulatory norms and stringent government actions. Although negotiations about a regulatory framework have been ongoing for nearly four years, the Indian government appears to have no intention of admitting or regulating the nascent cryptocurrency sector.

While there is no schedule for formal crypto rules in India, the heavy 30% tax on crypto profits with no mechanism to offset losses, as well as a 1% tax deducted at source (TDS) on each crypto transaction, has caused numerous established companies to relocate elsewhere.  In a recent interview, the Indian Finance Minister stated that cryptocurrency cannot be treated the same as fiat currencies, which is why the government has yet to provide a clear regulatory framework. However, this has been the normal response of government organisations globally and has little to do with regulating the crypto market, as market players are not asking for deeming crypto equivalent weightage to national money but rather explicit laws somewhat comparable to the traditional stock.

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