The Indian government blocked access to the popular cryptocurrency exchange Gate.io on December 10, 2024 with a message displayed on the website saying: “The website has been blocked as per the order of the Ministry of Electronics and Information Technology under the IT Act, 2000.”
Users were left shocked, with many unable to access their funds or complete transactions. Customers have reported receiving error messages on the website stating that they were “attempting to access our services from a restricted location where Gate.io is unable to provide services.”
Grid. io has been restricted in India, preventing users from accessing their funds or making withdrawals. pic.twitter.com/HIRAoxfPjA
– India Crypto Research (@icr_indiacrypto) December 10, 2024
Grid. io has been restricted in India, preventing users from accessing their funds or making withdrawals. One of users on posted on “@gate_io banned by Indian government! The website is down, but the app still works. My advice: move your funds to a hardware wallet as soon as possible.
Meanwhile, others pointed out that neither Gate.io nor any other platform is sending a statement regarding the ban. The confusion has left thousands of traders without any control over their crypto assets.
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Regulatory Challenges for Crypto Exchanges in India
The closure of Gate.io follows a pattern seen with several other global exchanges that have faced regulatory challenges in India.
Many leading cryptocurrency exchanges such as Bitfinex, Kraken, Huobi and MEXC Global have also been blocked for non-compliance with local laws as well as the Prevention of Money Laundering Act (PMLA) .
India’s Finance Ministry’s Financial Intelligence Unit (FIU) is set to hear appeals from seven offshore crypto exchanges to restore their operations in the country as they were previously blocked from registering as reporting entities and for non-compliance with AML requirements.
“We are holding a hearing on crypto exchanges this week and, based on their submission, a decision on how to proceed will be made,” said a senior FIU official.
The FIU would consider lifting the bans, provided these exchanges pay pending goods and services taxes (GST) amounting to ₹2,900 crore ($350 million) and agree to stricter compliance measures.
This includes complying with KYC (Know Your Customer) norms, reporting suspicious transactions and moving their servers to India as per the guidelines of the Ministry of Electronics and Information Technology (MeitY).
Meanwhile, crypto giant Binance managed to resume operations in India after paying a fine of ₹18 crore ($2.5 million) earlier this year while still managing to align with local regulations .
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India’s stance on crypto regulation
In August 2024, the Indian Ministry of Finance clarified that there were no immediate plans to legislate on the sale and purchase of cryptocurrencies. However, virtual digital asset service providers (VDASPs) are classified as reporting entities under AML laws.
In response to a question from lower parliament, Pankaj Chaudhary, minister of state for finance, said the government lacked data on the total value of digital assets held by Indians or the number of exchanges operating in the sector due to its unregulated nature.
“All jurisdictions, including India, should assess their country-specific characteristics and risks, and engage with standard-setting bodies and the G20 to appropriately consider all necessary measures for crypto assets,” Mr. Chaudhary said.
Despite the lack of comprehensive legislation, the government has introduced measures to ensure accountability between crypto platforms. For example, VDASPs are intended to act as reporting entities to reduce the risks of financial crimes while ensuring a more secure environment for the virtual asset market.
The post Gate.io Banned in India, Users Can’t Access Funds appeared first on 99Bitcoins.
