- The exchange’s re-entry plan includes paying a fine of around $2 million.
- Binance plans to operate as a registered business with the FIU of the finance ministry.
Although the Indian government outright banned Binance earlier this year, the biggest cryptocurrency exchange in the world is getting ready to rejoin the Indian market. According to those familiar with the situation, Binance’s re-entry plan includes paying a fine of around $2 million.
In order to demonstrate its dedication to following Indian rules and regulations, the exchange plans to operate as a registered business with the Financial Intelligence Unit (FIU) of the finance ministry.
Significantly Altering Market Dynamics
Binance has taken this step because it understands how important it is to comply with Indian regulations regarding cryptocurrencies, especially the Prevention of Money Laundering Act (PMLA) and the Virtual Digital Assets (VDA) taxation framework, which are among the most severe in the world.
Before the prohibition, Binance had a stranglehold on the $4 billion worth of cryptocurrency in India, controlling roughly 90% of the market. Although regulated exchanges are required to pay 1% tax deducted at source (TDS), investors were able to participate in trading operations without paying this due to the exchange’s failure to comply with tax legislation.
Indian cryptocurrency investors changed their strategy after the ban and began trading on domestic platforms like CoinDCX and WazirX. Large amounts of money poured into these platforms as a consequence of this move.
Furthermore, studies show that international cryptocurrency exchanges that did not have an Indian registered office leaked almost 3,000 crore rupees in taxes every year.
The crypto business in India is seeing a favorable growth with Binance’s strategy change to comply with Indian laws and regulations. Due to its higher liquidity and better technology than local exchanges, market watchers believe that Binance’s return to the Indian market might significantly alter market dynamics.
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