India has imposed a significant fine on the crypto exchange Bybit. The Financial Intelligence Unit-India (FIU-IND) penalized Bybit Fintech Ltd. with ₹9.27 crore, roughly $1.06 million USD, for breaching anti-money laundering laws. This crackdown comes as authorities intensify efforts against unregistered crypto operations in the country.
The Indian Ministry of Finance made this announcement last week. The penalty was confirmed by FIU-IND Director Vivek Aggarwal on January 31, 2025. Following a thorough investigation, officials found that Bybit had committed multiple violations. The ministry stressed that Bybit expanded its services in India without necessary registration with the FIU-IND.
In a public statement, the Ministry of Finance said, “The persistent and continuous non-compliance caused FIU-IND to block their websites.” This action aimed to halt operations under the Information Technology Act, 2000, in collaboration with the Ministry of Electronics and Communication Technology (MEITY).
Bybit, classified as a “reporting entity” under the Prevention of Money Laundering Act, 2002 (PMLA), was required to follow strict regulatory measures. However, the company chose to operate without the necessary approvals. The Ministry of Finance highlighted that FIU-IND had previously issued guidelines for crypto service providers on March 10, 2023. A further circular on October 17, 2023, mandated all virtual digital asset (VDA) service providers to register as reporting entities. Bybit’s failure to comply led to the recent sanctions.
After reviewing Bybit’s written and oral submissions, Aggarwal concluded that the exchange violated several provisions of the Prevention of Money Laundering (Maintenance of Records) Rules, 2005. The Ministry confirmed that, through an order dated January 31, 2025, it was firmly established that Bybit breached Section 12(1) of the PMLA. Consequently, the hefty penalty of ₹9,27,00,000 was imposed on the company.
The Ministry of Finance reaffirmed its commitment to enforcing anti-money laundering regulations in the virtual asset sector. It emphasized that all digital asset service providers must adhere to Indian financial laws. As Bybit’s operations come to a halt in India, the message is clear: compliance with regulations is non-negotiable.
