OKX cryptocurrency exchange is set to cease its operations in India, following compliance notices issued by the Financial Intelligence Unit (FIU) of the Indian Ministry of Finance to nine foreign crypto exchanges three months ago.
In a notice sent to Indian users on March 21, OKX urged its users to close their accounts and withdraw their funds by April 30. The decision to exit the Indian market was primarily driven by local regulatory challenges, according to the crypto exchange.
The FIU instructed the Ministry of Electronics and Information Technology to block the websites of the identified crypto exchanges within two weeks of receiving the notice. As a result, OKX had its website and application blocked in January. It responded by implementing a new registration process that included thorough Know Your Customer checks. However, the notice to users indicates that OKX will no longer operate in India.
India presents difficulties for foreign crypto exchanges due to the absence of clear regulatory guidelines and the strict actions of the government, despite being a promising market. Discussions on a regulatory framework have been ongoing for nearly four years, but the Indian government has shown no intention of acknowledging or subjecting the emerging crypto market to legal supervision.
While there is no specific timeline for the implementation of formal crypto regulations in India, the heavy 30% tax on crypto income, coupled with the inability to offset losses and a 1% tax deducted at source (TDS) on each crypto transaction, has prompted several established players to relocate to other jurisdictions.
In a recent interview, the Indian Finance Minister stated that crypto cannot be treated in the same manner as fiat currencies, which is why the government has yet to provide a clear regulatory structure. However, this response is common among government bodies worldwide and does not address the need for regulation in the crypto market. Market participants are not seeking equal treatment of crypto and fiat, but rather clearer regulations similar to those governing traditional stock markets.
Cointelegraph has reached out to OKX for comment, but has not yet received a response.