India -- Sanctions Compliance Regulatory Overview

India does not have OFAC, EU, or UN sanctions compliance requirements specifically mandated for Virtual Asset Service Providers (VASPs) in its cryptocurrency regulatory framework. However, India's crypto regulations incorporate broader anti-money laundering and counter-terrorism financing standards that implicitly align with international sanctions principles.

Applicable Regulatory Framework

Prevention of Money Laundering Act (PMLA), 2002 is the primary legislation governing cryptocurrency transactions in India[4][6]. As of March 7, 2023, the Indian Ministry of Finance brought Virtual Digital Assets (VDAs), including cryptocurrencies, under the PMLA's purview[4][6]. This framework enables the government to investigate cryptocurrency transactions suspected of being "proceeds of crime" and to regulate and track such transactions[6].

Know Your Customer (KYC) and Anti-Money Laundering (AML) Compliance: Crypto exchanges and other service providers must comply with stringent KYC norms to verify user identity[4]. As of 2025, India has implemented enhanced requirements, including collection of live selfies and geographic location data during user onboarding[5]. The Financial Intelligence Unit India (FIU-IND) has also issued updated guidelines covering governance, cybersecurity, and transaction monitoring[5].

Sanctioned Entity Screening

While the search results do not specify India-specific sanctions lists equivalent to OFAC's Specially Designated Nationals (SDN) list, India operates under the Financial Action Task Force (FATF) Travel Rule standards[4]. This global standard requires VASPs to implement enhanced due diligence and transaction monitoring. The FIU-IND enforces compliance with these international standards as part of its broader anti-money laundering and counter-terrorism financing efforts[4].

Penalties for Non-Compliance

Non-compliant crypto platforms face significant enforcement actions:

• Fines and operational bans, including permanent suspension[2]
• Blacklisting by FIU-IND, which prevents legal operation in India[2]
• Mandatory app and website removal from public access in India[1]

In October 2025, the FIU-IND issued notices to 25 crypto exchanges—including BingX, LBank, CoinW, ProBit Global, BTCC, AscendEX, Zoomex, and Poloniex—for failing to comply with anti-money laundering rules[1]. More than 15 exchanges received warnings in 2024 for failing to adhere to AML/KYC reporting rules[2].

Geographic Restrictions

India does not explicitly restrict cryptocurrency trading by foreign users, but offshore crypto platforms serving Indian users must register with FIU-IND and comply with Indian anti-money laundering obligations[1]. The government has taken enforcement action against major international exchanges that failed to register, including actions that led OKX to exit the Indian market entirely[1].

Limitations of Available Information

The search results do not provide specific references to OFAC, EU, or UN sanctions lists as they apply to Indian crypto operations, nor do they detail whether Indian VASPs are required to cross-reference international sanctions databases. India's regulatory framework focuses primarily on domestic AML/KYC compliance rather than explicitly incorporating external sanctions regimes.