India Imposes Anti-Money Laundering Rules on Crypto Transactions

  • India subjects crypto transactions to Anti-Money Laundering law – The Ministry of Finance has issued a notification obliging financial institutions and virtual asset services providers to comply with the Prevention of Money-Laundering Act 2002.
  • Impact on the Indian crypto industry – Crypto businesses in India have been subject to strict tax rules since March 2022, resulting in a steep decline in trading volume. In February 2023, there was also a ban on crypto advertising and sponsorships.
  • AML standards tightening worldwide – Regulators around the world are increasing their efforts towards tightening AML standards for cryptocurrencies, which complicate the life of crypto companies even further.

India subjects Crypto Transactions to Anti-Money Laundering Law

The Gazette of India published a notification from the Ministry of Finance, subjecting a range of crypto transactions to the Prevention of Money-Laundering Act (PMLA) 2002. This includes exchange, transfers, safekeeping and administration of virtual assets as well as financial services related to an issuer’s offer and sale of virtual assets. The PMLA obliges financial institutions to maintain a record of all transactions for the last ten years, provide these records to officials if demanded, and verify the identity of all their clients.

Impact on Indian Crypto Industry

The amended tax rules imposed since March 2022 have had serious consequences on the Indian cryptocurrency market: trading volume dropped by 70% within 10 days after introducing this policy. To make matters worse, February 2023 brought another ban on crypto advertising and sponsorships across both men’s cricket Premier League and women’s cricket league.

AML Standards Tightening Worldwide

Regulators around the world are intensifying their efforts towards tightening AML standards for cryptocurrencies. This international trend puts an additional burden on already struggling Indian crypto companies.


The introduction of stricter AML laws will most likely complicate business operations for Indian cryptocurrency companies even further. Nevertheless, it is also an important step towards regulating digital assets that could eventually lead to greater trust in them from regular investors.

Further Reading For more information about this topic please refer to our article “India Subjects Crypto Transactions To Anti-Money Laundering Law”.

Comments are closed