Government imposes anti-money laundering provisions on crypto sector in India

In the latest step to tighten oversight of digital assets, the Indian government has imposed money laundering provisions on the cryptocurrency sector.

On Tuesday, a Finance Ministry notice revealed that crypto businesses—exchanges, custodians, wallet providers, and others—will come under the Prevention of Money-laundering Act, 2002 (PMLA)

The laws will apply to any exchange between virtual digital assets and fiat currencies; exchange between one or more forms of virtual digital assets; and the transfer of digital assets.

This move aligns with the global trend of requiring digital-asset platforms “to follow anti-money laundering standards similar to those followed by other regulated entities like banks or stock brokers,” Jaideep Reddy, counsel at law firm Trilegal, told Bloomberg. 

The latest anti-money laundering measure “is concerning as implementing the requisite compliance measures is likely to require time and resources,” Reddy added.