Cryptocurrency Exchange OKx shutting down services in India

Users in India who are using the cryptocurrency exchange platform “OKx” have been advised by the company to withdraw all their funds from the platform as the company is shutting down its operations in India “due to local regulations”. The users were recently told by the platform to withdraw their funds by the end of April. Cryptocurrencies are unregulated by the Indian Government and the finance minister had recently vocalized that cryptocurrencies are not currencies. 

The crypto exchange sent out a notice to the users on Thursday, stating: “We regret to inform you that Okx is no longer providing services to users in India. Due to local regulations, you need to withdraw all funds from your account.” In addition to this, the platform also advised all users to “close all margin positions as well as positions in perpetuals, futures and options” and also “redeem all funds from Grow products: Earn, Loan, Jumpstart.” These particular steps are to be completed by 30th April at 12 a.m. UTC, as per the advice of OKx. After this time period, the accounts will only be allowed to make withdrawals and all the other functions will be restricted. 

This announcement came from OKx after several cryptocurrency apps were recently removed by Apple and Google from their app stores. This move by Google and Apple followed India’s Financial Intelligence Unit (FIU) recently identifying these exchanges as engaging in illegal operations within the country. In December of the prior year, India’s FIU issued “compliance Show Cause Notices” to nine offshore crypto service providers. The Ministry of Finance in India revealed that, as of that period, 31 crypto service providers had completed registration with the FIU. Nirmala Sitharaman, the finance minister of India said just last week that cryptocurrencies are not currencies, saying that “we have not regulated them even now”. 

India, who hosted G20 last year, raised the issue of crypto assets being regulated with G20. “If one country regulates it and others don’t, it’ll be an easy way of moving money, round-tripping, or funding drugs, or even terrorism and so on. So we wanted to create a kind of a framework by taking it to the level of G20,” Sitharaman recently stressed.

Alongside OKx, Binance, Kucoin, Houbi, Kraken,, Bittrex, Bitstamp, MEXC Global, and Bitfinex also received show-cause notices on the 28th of December for not registering with the Financial Intelligence Unit-India (FIU-IND) and abiding by the provisions of Prevention of Money Laundering Act (PMLA), 2002, which deemed their operations in India illegal. Although OKX was not directly mentioned in the public statement by the Financial Intelligence Unit (FIU), the agency’s enforcement actions against numerous other cryptocurrency exchanges operating “illegally” in India have undoubtedly reverberated throughout the industry.

Cryptocurrencies were bought under the ambit of anti-money laundering and counter-financing of terrorism regulations in March last year by the FIU. However, despite this, numerous international exchanges, OKX included, have faced challenges in adhering to the continuously evolving regulatory framework. 

OKx’s decision to stop its services in India Underlines the difficulties faced by crypto exchanges in navigating through regulatory uncertainties in India. 

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