India's crypto landscape has long been a paradox: one of the world's largest markets by adoption, yet notoriously difficult for global exchanges to operate in. That reality was fundamentally reset in 2023 when New Delhi amended the Prevention of Money Laundering Act (PMLA). This move made it mandatory for every crypto exchange serving Indian users—regardless of their base of operation—to officially register with the Financial Intelligence Unit-India (FIU-IND). The message delivered by regulators was unequivocal: either comply with India's strict rules, or exit the market.
Within weeks of the regulatory change, global giants like Binance, KuCoin, Kraken, and Bitfinex saw their applications and URLs blocked, effectively shutting down the "grey market" era of operating without regulatory oversight. Fast forward to 2025, the narrative has shifted to compliance. A total of 15 international exchanges have filed for registration with the FIU, with seven—including Binance, KuCoin, Coinbase, and Bybit—having successfully cleared the hurdle. This compliance was costly, involving nearly $15 million in total fines levied against non-registered platforms.
The registration process is far more than just paperwork. It mandates integrating full INR payment rails, rigorous enforcement of Know Your Customer (KYC) and Anti-Money Laundering (AML) standards, and compliance with India's 1% TDS (Tax Deducted at Source) regime on all trades. Nevertheless, for firms like Coinbase, which formally relaunched operations in October 2025, the opportunity vastly outweighs the regulatory burden. With India topping the Chainalysis adoption index for two consecutive years, the country represents a soaring market, proving to be too large and too young for global crypto firms to ignore, solidifying the idea that in this market, compliance is the ultimate price of survival.