India’s Financial Intelligence Unit has issued non-compliance notices to 15 crypto service providers and asked for their apps and websites to be taken down, setting up sudden account lockouts for users of offshore platforms.
The notices, disclosed in a FIU-IND release dated September 9, were issued under India’s information technology law and intermediary rules. The agency, which enforces anti-money laundering registration for virtual digital asset service providers, did not name every platform in its public statement. Industry trackers have associated the action with exchanges including BloFin, Toobit, and XT.com, all of which serve Indian users without local AML registration.
A key caveat: the release shows takedown requests, not completed blocks. It does not confirm that app stores or internet providers have carried out the removals, nor that customer funds or withdrawals are frozen. In a previous clampdown on foreign exchanges, some sites became unreachable in certain browsers while others stayed accessible for weeks, so the practical effect is likely to arrive unevenly. CryptoSlate tested access during the earlier round and documented exactly that split behavior across browsers and networks.
What the notices demand
FIU-IND requires any crypto exchange or wallet serving Indian users to register with the agency and file suspicious transaction reports, mirroring obligations that banks face. Registration also means paying penalties for past unregistered operation when the agency demands them. The 15 providers targeted this month allegedly skipped that step while still marketing to Indian customers. The takedown orders seek removal of apps from distribution channels and blocking of the associated URLs at the network level.
| Item | Status per the Sept 9 release |
|---|---|
| Non-compliance notices | Issued to 15 providers |
| App and URL takedown requests | Issued under IT law and intermediary rules |
| Completed blocks by stores or ISPs | Not confirmed |
| Frozen funds or withdrawals | Not indicated |
For users, the risk is practical rather than legal. If an app disappears from stores and its web domain stops resolving, access depends on VPNs and offshore mirrors. Customers who hold balances on an unregistered platform have no local regulator to escalate to if withdrawals stall. Indian tax law still applies to their gains regardless of where the platform sits, which means traders can owe the 30 percent levy on profits earned through venues that may vanish from the app store next week. Deducting that tax at the source is not possible on an unregistered platform, which leaves the reporting burden entirely on the individual.
Part of a longer enforcement arc
India has pushed offshore exchanges toward registration since late 2023, when the FIU first moved against several major global platforms and the electronics ministry ordered app store removals. Show-cause notices went out in December of that year, and blocks followed within weeks. Some of those operators later registered and paid penalties to keep serving the Indian market. Others chose geo-blocking instead, cutting Indian IP addresses to avoid further exposure. The current wave extends the same playbook to a second tier of exchanges that grew as users looked for alternatives after the first round.
The compliance posture sits alongside India’s broader digital asset stance. The country has kept crypto taxation strict, with a flat 30 percent tax on gains and a 1 percent deduction at source on trades, but it has never banned holding crypto outright. There is no comprehensive crypto statute yet; the government relies on the Prevention of Money Laundering Act, tax law, and the IT rules to govern the sector. Registration and reporting, not prohibition, is the policy instrument of choice, and this week’s notices fit that pattern precisely. Officials have framed the goal as bringing every platform that touches Indian users inside the reporting perimeter, one enforcement round at a time.
Context for the industry
The enforcement comes as India’s legitimate crypto market keeps institutionalizing. Among recent domestic developments, the state bond market tokenization pilot has drawn global attention, and registered exchanges report steady retail volumes. A cleaner registered market is the government’s stated goal, and squeezing unregistered offshore apps is the other side of that coin. Domestic platforms, which bear the compliance costs their offshore rivals avoid, have long lobbied for exactly this kind of action. When the first wave hit in early 2024, the co-founder of a major Indian exchange publicly welcomed the level playing field and said the company had opened deposit routes to absorb migrating users.
Exchanges named in connection with the current action have not publicly confirmed receiving the notices. Under prior rounds, affected platforms typically responded within weeks, either by registering with FIU-IND and paying a penalty or by blocking Indian users outright. Both paths leave a gap during which Indian customers cannot know whether the app they use today will still load tomorrow. Payment channels add another layer of risk, since banks and card networks treat unregistered crypto platforms as prohibited merchants, and UPI rails in particular have stayed closed to them throughout.
Advisers in the Indian market continue to repeat the standard warning: keep funds on registered platforms, or in self-custody, rather than on apps that operate without local registration. That advice carried weight in early 2024 when offshore sites went dark mid-week, and it carries more weight now that the FIU has shown it will keep expanding the list. The agency has signaled that takedown rounds will continue as long as unregistered operators target Indian users. For the 15 platforms in this round, the realistic options are the same two doors their predecessors walked through: register and pay, or exit the market. Users should plan for either outcome before the apps stop loading.