- Ceasing operations in India due to regulatory hurdles could impact OKX’s global operations and reputation.
- As a major player in the cryptocurrency exchange industry, OKX’s decision to discontinue services in India may raise concerns among investors and users about the exchange’s ability to navigate regulatory challenges in other jurisdictions.
Cryptocurrency exchange OKX has communicated with its Indian user base via email, announcing the discontinuation of its services in the country. Users have been advised to initiate fund withdrawals before the end of April.
This decision follows the blocking of OKX along with eight other foreign crypto exchanges in India, prompted by compliance notices issued by local regulators.
In a notice sent out on Thursday, March 21, OKX urged its Indian customers to close their accounts and withdraw funds by April 30. The exchange cited regulatory obstacles as the primary rationale behind this move, expressing regret over ceasing services in India.
To comply with the directive, OKX users in India have been instructed to close all active positions, including margin, perpetuals, futures, and options, and to withdraw funds from products like Earn, Loan, and Jumpstart by the midnight deadline on April 30. Users have been advised to expedite the withdrawal process to prevent any potential losses, with reassurances from OKX that their funds will remain secure and accessible until withdrawn.
The decision to cease operations in India comes after OKX faced website and application blocks in January, following a request from the Financial Intelligence Unit (FIU) to block the websites of non-compliant crypto exchanges within two weeks. Despite efforts to comply, including applying for a new registration process with rigorous Know Your Customer (KYC) checks, OKX has indicated its inability to complete the registration successfully.
In December 2023, India’s Ministry of Finance’s FIU issued non-compliance notices to various cryptocurrency exchanges, directing them to register as reporting entities and submit statements to the income tax department or face website blocks. While some local exchanges complied with the FIU’s requirements, several international exchanges, including OKX, failed to adhere to Indian law, leading to app blocks by Apple’s App Store and Google Play Store in India.
Navigating the regulatory landscape in India remains arduous for foreign exchanges due to the absence of clear guidelines and stringent government actions. Despite ongoing discussions over nearly four years, the Indian government has yet to establish a formal regulatory framework for the cryptocurrency market, leaving industry players uncertain about their legal obligations.
Compounding the challenges are India’s stringent tax regulations, which impose a hefty 30% tax on crypto income without provisions for offsetting losses, along with a 1% tax deducted at source (TDS) on each crypto transaction. These regulations have prompted several established players to relocate their operations to more crypto-friendly jurisdictions.
OKX stands as one of the world’s leading cryptocurrency spot and derivatives exchanges, ranking second in terms of trading volume and serving a user base exceeding 50 million individuals worldwide. OKX provides a platform for investors to trade various cryptocurrencies, including Bitcoin and Ethereum, and operates in multiple global markets, including Hong Kong, the United Arab Emirates, The Bahamas, and France.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
