India Enforces Stricter KYC Rules for Crypto Platforms
- India’s Financial Intelligence Unit (FIU) has implemented new guidelines mandating live selfie verification and geolocation checks for users on crypto exchanges.
- Exchanges must verify user bank accounts by sending a small transaction to comply with anti-money laundering (AML) regulations.
- Users are required to submit additional government-issued photo IDs and verify their email and mobile numbers during account creation.
- Under India’s Income Tax Act, cryptocurrency gains are taxed at a rate of 30%, with no allowance for tax loss harvesting across different transactions.
- Officials from the Income Tax Department have expressed concerns that decentralized finance platforms hinder effective tax enforcement.
The new KYC measures reflect India’s regulatory approach towards cryptocurrencies, aiming to enhance compliance in a market with over 1.4 billion potential users. This could lead to increased investment in the crypto sector as more individuals come onchain.
With the recent changes, users must now adhere to stricter identification processes, which may impact how they engage with crypto platforms in India. (Source)
