Bybit’s Regulatory Journey in India

The registration of Bybit with FIU-IND exemplifies the company’s dedication to aligning with India’s ever-evolving regulatory framework. The exchange has been actively collaborating with FIU-IND to ensure compliance with the Prevention of Money Laundering Act (PMLA) and related regulations.

Bybit acknowledges the crucial importance of implementing stringent Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) protocols. The exchange has committed itself to maintaining the highest ethical standards in these critical areas.

In a formal statement, Bybit expressed, “We have been working tirelessly with the FIU-IND to address their concerns and guarantee full compliance with the Prevention of Money Laundering Act and related guidelines.”

This proactive stance indicates Bybit’s commitment to resolving previous regulatory issues, further reinforcing its dedication to transparency and trust within the Indian market.

India’s Cryptocurrency Regulatory Environment

India’s perspective on cryptocurrencies has been notably cautious and measured. In March 2023, the government mandated that all virtual digital asset service providers, including foreign exchanges, must register with FIU-IND and comply with the PMLA. This initiative aims to enhance oversight and curb risks related to money laundering and terrorist financing.

In December 2023, the FIU-IND issued compliance notices to nine prominent platforms, including Binance and Kraken, due to allegations of unauthorized operations within the country.

Even amid these regulatory challenges, the adoption of cryptocurrencies in India has experienced notable growth. Investors have allocated significant funds into digital assets, despite the government’s imposition of a 30% tax on crypto earnings and a 1% Tax Deducted at Source (TDS) on transactions since July 2022. These measures were established to bring cryptocurrency activities under the tax purview and monitor the flow of digital assets more effectively.

In the Union Budget for 2025-26, Finance Minister Nirmala Sitharaman proposed amendments to the Income Tax Act that would require specified reporting entities to provide details of transactions related to virtual digital assets (VDAs). This initiative is designed to bolster the reporting framework, promoting greater transparency in the realm of cryptocurrency transactions.

Bybit’s Initiatives in India

In addition to regulatory compliance, Bybit is proactively engaging with the Indian cryptocurrency community. The exchange has become a Silver Associate Member of the Bharat Web3 Association (BWA), with the goal of fostering Web3 adoption and encouraging innovation within the Indian crypto space.

Moreover, Bybit has launched a not-for-profit venture known as the Blockchain for Good Alliance (BGA), collaborating with blockchain societies from renowned institutions such as the Indian Institutes of Technology (IIT) Delhi and IIT Kharagpur. Through these partnerships, Bybit plans to host a series of hackathons, workshops, and various events aimed at enhancing knowledge and awareness of crypto and blockchain technology in India.

The Broader Implications of Bybit’s Registration with FIU-IND

Bybit’s registration with FIU-IND, along with its proactive measures in the Indian landscape, mirrors the trend of international cryptocurrency exchanges striving to comply with local regulations. This approach is crucial not only for ensuring adherence but also for fostering trust among users and governing bodies alike.

India’s cryptocurrency domain finds itself at a pivotal juncture. Although the government’s rigorous tax policies and regulatory measures indicate a careful strategy, the considerable investment influx and robust interest in digital assets hint at a burgeoning market. Recent developments, including the incorporation of crypto assets into the criteria for undisclosed income, further reflect the government’s intent to tighten oversight in this sector.

Economic Affairs Secretary Ajay Seth has emphasized the necessity of adopting a balanced approach, suggesting that India’s perspective cannot be unilaterally dictated due to the borderless characteristics of cryptocurrencies. This indicates a willingness to reassess India’s crypto regulations in light of global trends and advancements.