According to recent reports, the decision comes in response to the regulatory hurdles the exchange faces in the country.
The cryptocurrency ecosystem in India faces a new challenge following the announcement by OKX, one of the most prominent cryptocurrency exchanges globally, about ceasing its operations in the country. This decision highlights the growing tensions between foreign exchange platforms and local regulators, marking a turning point in the cryptocurrency industry in India.
In a recent development, Seychelles-based company OKX, one of the largest cryptocurrency exchanges in the world, announced the closure of its services in India. Users were notified of the closure via a notice sent on Thursday, stating that OKX “no longer provides services to users in India” due to local regulations.
OKX, being among the nine foreign cryptocurrency exchanges blocked in India following compliance notices issued by the Financial Intelligence Unit (FIU) of the Ministry of Finance, has taken the decision to ask its users in India to close their accounts and withdraw their funds before April 30. This move underscores the difficulties cryptocurrency companies face operating within a still-developing Indian regulatory framework.
OKX Announces Exit from Indian Crypto Market
OKX’s notice urged users to take specific actions before the deadline. Users were ordered to close all margin positions, including perpetual, futures and options contracts, and redeem funds from betting products. Additionally, users were advised to withdraw all funds from their accounts.
After April 30, 2024, at 2 a.m. m. UTC, account functionalities would be restricted, although withdrawals of funds would still be allowed. OKX’s decision to exit the Indian market follows the issuance of an enforcement notice by India’s Financial Intelligence Unit (FIU) against nine foreign cryptocurrency exchanges, including Binance, KuCoin, Huobi, Kraken, Gate.io, Bittrex, Bitstamp, MEXC Global and Bitfinex.
The FIU alleged illegal operations and violations of local anti-money laundering (AML) regulations by the aforementioned exchanges. While the FIU blocked access to the websites of these exchanges with a two-week notice, some continued to provide services to existing clients through apps.
OKX was not among the exchanges named by the FIU in its compliance notice. However, the exchange had previously strengthened its know-your-customer (KYC) processes in India. Despite these efforts, OKX has now decided to completely withdraw its services from the country.
Navigating the Regulatory Landscape
Despite shutting down its operations in India, OKX is focusing on strengthening its operations in other regions. As previously reported, the exchange obtained licenses in Singapore and Dubai, demonstrating its interest in expanding its services globally.
Additionally, OKX has started operations in Türkiye’s local currency. The shutdown of OKX services in India highlights the challenges facing cryptocurrency exchanges due to the evolving regulatory landscape. As governments around the world continue to formulate their policies regarding cryptocurrencies, exchanges have to navigate a complex regulatory environment to ensure compliance and provide services to their users.
While OKX emphasizes the security of user funds and ensures that withdrawals will remain accessible, Indian users are encouraged to follow the exchange’s guidelines to protect their assets.
Currently, the total valuation of the crypto market capitalization is $2.44 trillion. This comes after a significant drop to $2.2 trillion on Wednesday, following a high of $2.7 trillion, which had not been reached since November 2021.
Bitcoin (BTC), on the other hand, has advanced in minimizing their losses. After experiencing a sharp decline to $60,900, it is now trying to regain stability above the $66,700 level.
By Leonardo Perez
