Google has taken a significant step by removing popular global crypto exchanges, including Binance and Kraken, from its Play Store in India. The decision follows allegations of these exchanges engaging in “illegal” activities, prompting the Financial Intelligence Unit (FIU) to issue show cause notices to nine crypto firms.
Last month, the FIU expressed concerns about the non-compliance of these firms with India’s anti-money laundering regulations. Subsequently, Apple also removed their apps, and various telecom networks and internet service providers started blocking the URLs of the affected crypto exchange websites.
The list of affected crypto exchanges encompasses Huobi, Gate.io, Bittrex, and Bitfinex. Binance, a prominent player in the crypto space, acknowledged the situation, clarifying that the IP block only impacts users trying to access the Indian iOS app store or the Binance website from India. Existing users with the Binance app remain unaffected.
The company emphasized its commitment to complying with local regulations and laws, pledging continuous communication with regulators to ensure user protection and the healthy development of the Web3 industry.
Google’s move comes in the wake of India introducing a 30% capital gains tax and a 1% transaction levy in 2022. This led domestic cryptocurrency traders to migrate to global platforms with less stringent know-your-customer protocols.
This regulatory shift, coupled with a broader downturn in the crypto market, resulted in a substantial decline in the trading volumes of local exchanges. An estimated three to five million customers reportedly shifted from local to offshore exchanges following the implementation of the 1% TDS.
Despite calls from the local crypto community for clearer regulations from the Indian government, the situation remains uncertain. Earlier reports indicated that the governor of the Reserve Bank of India maintained an unchanged stance on cryptocurrency, viewing it as a potential disruptor in emerging markets like India.