Earlier, the exchange’s app and website were blocked on the territory of the country

OKX to cease operations in India due to regulatory concerns

21.03.2024 - 15:12

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3 min

What’s new? Crypto exchange OKX sent out an email to Indian customers asking them to close their accounts by April 30. The exchange cited local regulatory hurdles as the main reason for ceasing operations in the country. OKX has been operating in the Indian market for less than a year: it announced its expansion plans in September 2023.

Material by Cointelegraph

What else is known? In late December, India’s fintech agency accused a number of major foreign crypto exchanges of failing to comply with anti-money laundering laws and asked the Ministry of Electronics and Information Technology to block their websites in the country.

Although OKX was not named in the fintech press release, its app has disappeared from the local App Store and its website has also been blocked. In response, the exchange implemented a more thorough customer identification procedure (KYC) but ultimately decided to cease operations.

India remains a challenging market for foreign crypto exchanges despite the lack of a clear regulatory framework and strict oversight. Meanwhile, the Central Bank of India has repeatedly stated the threat of cryptocurrencies to currency sovereignty due to money laundering risks and has also compared cryptocurrencies to gambling due to high volatility. Late last year, the regulator said the legalization of cryptocurrencies has no benefits for the economy.

In March, the Ministry of Finance said that cryptocurrencies cannot be regulated similarly to fiat, and the government will have to develop a separate regulatory framework. It is noteworthy that it was under the chairmanship of India that the G20 countries approved a plan to introduce global regulation of cryptocurrencies back in October last year.

High taxes also create difficulties for crypto companies when operating in the Indian market. The levy on crypto transaction revenues is 30%, with another 1% levied as tax deducted at source (TDS). In the three months after these fees were introduced in April 2022, trading volume on local exchanges collapsed by 72%, and some platforms later decided to move their headquarters to other jurisdictions.

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OKX had previously discontinued services in Uzbekistan, but at the same time launched a localized platform in Turkey and an exchange, P2P platform, and Web 3.0 wallet in Argentina.

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