In a recent announcement, crypto exchange Bybit has stated that it will temporarily suspend its services for users in India in light of the country’s evolving regulatory landscape. This decision highlights the increasing pressure that cryptocurrency platforms face as governments around the world seek to implement clearer regulations.
Beginning Sunday, Bybit users in India will be unable to open new trades or access various products on the platform, although the company has confirmed that withdrawals will remain operational. This has been communicated through a blog post released by Bybit, which emphasizes its intention to comply with local laws.
The suspension of services may not be permanent, as Bybit is actively working to complete its registration process as a Virtual Digital Asset Service Provider under Indian law. The company expressed optimism about securing this registration in the upcoming weeks, showcasing its commitment to re-establishing full service as soon as compliance with the Financial Intelligence Unit (FIU) is finalized.
This move comes on the heels of significant regulatory developments in India. In March 2023, the Indian government mandated that crypto businesses must register with the FIU to tackle anti-money laundering efforts, thereby holding providers accountable for customer verification processes under the Prevention of Money Laundering Act (PMLA).
The finance ministry of India had previously indicated that these regulatory measures would also apply to offshore exchanges, and robust actions would be taken against any non-compliant platforms. In this context, Bybit’s proactive suspension of services can be seen as a strategic move to avoid penalties while aligning with these regulations.
As the cryptocurrency market continues to evolve, exchanges like Bybit are learning to navigate new challenges and maintain compliance. The industry’s ability to adapt to regulatory frameworks will be crucial in fostering long-term sustainability and acceptance of digital assets across global markets.
