India never banned cryptocurrency itself-but it did shut the door on dozens of international crypto exchanges that refused to play by its rules. If you’re trying to trade crypto in India today, you need to know which platforms are blocked, which ones are legal, and why the difference matters more than ever.
What Exactly Got Banned?
It’s not about the coins. It’s about the platforms. Starting in 2023 and accelerating through 2024, India’s Financial Intelligence Unit (FIU-IND) started blocking websites and apps of foreign crypto exchanges that didn’t register under Indian law. These weren’t random takedowns. They were systematic enforcement actions against platforms that refused to comply with reporting rules, KYC standards, and transaction tracking requirements. Exchanges like Binance, KuCoin, and Bybit were among the first to lose access. Their websites stopped loading for Indian users. Mobile apps disappeared from app stores. Bank transfers to these platforms were blocked. Even if you had money in them, withdrawing INR became nearly impossible. The reason? No FIU-IND registration. That’s the key. Every exchange that wants to serve Indian customers must register with FIU-IND and submit detailed records of every trade, deposit, and withdrawal. Non-compliant platforms simply don’t get a license to operate.Why Did India Do This?
India’s move wasn’t about stopping crypto-it was about controlling it. Before 2023, users flocked to offshore exchanges like Binance and KuCoin because they offered lower fees, more coins, and better liquidity. But those platforms didn’t report user data to Indian tax authorities. That meant billions in crypto gains went untaxed. The Enforcement Directorate (ED) started investigating suspected money laundering cases tied to unregulated platforms, and the government realized it needed a way to track transactions. The turning point came with Section 285BAA of the Finance Bill, passed in February 2025. It gave FIU-IND the power to demand historical trade data from any exchange serving Indian users-even if they registered years later. That meant if Binance signed up in 2026, they’d have to hand over every trade made by Indian users since 2020. No exchange wanted that kind of liability, so most just walked away. The result? A clean break. India now has a clear line: if you’re not registered with FIU-IND, you’re banned. No gray area. No exceptions.Which Exchanges Are Still Legal in India?
The legal ones are all Indian. They’re the ones that registered with FIU-IND and built their systems to meet local compliance rules. These platforms now dominate the market. Here are the top five:- CoinDCX - India’s largest exchange by trading volume. Grew over 2,000% in deposits after foreign platforms were blocked.
- WazirX - Acquired by Binance in 2019 but now fully compliant. Offers INR deposits and tax reports.
- ZebPay - One of India’s oldest exchanges. Still operating since 2014 with full FIU registration.
- Unocoin - First Indian crypto exchange to get FIU registration. Known for strong customer support.
- Mudrex - Gained 10,000+ new users in weeks after the crackdown. Popular for automated trading bots.
What Happens If You Use a Banned Exchange?
You can still access banned exchanges using VPNs or third-party wallets-but it’s risky. Here’s what you’re signing up for:- No INR withdrawals - Banks block transfers to unregistered exchanges. Your money might be stuck.
- No tax reports - You’re on your own to track every trade and calculate 31.2% tax. No CSV exports. No auto-filing.
- No customer support - If your account gets frozen, there’s no Indian legal recourse. You can’t file a complaint with RBI or FIU.
- Account freezes - Exchanges like Binance have frozen Indian accounts without warning, citing compliance issues. No refunds.
- Tax penalties - If the tax department finds unreported crypto gains, penalties can hit up to 60% of the profit under Section 158BA(7).
What About Decentralized Exchanges (DEXs)?
DEXs like Uniswap or PancakeSwap aren’t blocked because they’re not companies-they’re smart contracts. But here’s the catch: you still owe taxes on every trade. And if you use a DEX to swap crypto into INR via a peer-to-peer (P2P) platform, you’re still subject to the same tax rules. The FIU doesn’t care if you used a DEX or a centralized exchange. If you made a profit, you pay tax. The real danger with DEXs? You’re completely on your own. No KYC means no audit trail. If the tax department comes knocking, you’ll have to prove every transaction manually-without any help from the exchange.
Will Binance or Coinbase Ever Come Back?
Technically, yes. They can register with FIU-IND anytime. But they’d have to hand over years of user data, hire local compliance teams, and accept Indian tax reporting rules. That’s expensive and risky. So far, none have taken the step. Coinbase briefly explored setting up an Indian entity in 2024 but backed out after realizing the cost of retroactive data reporting. Binance paid ₹75 crore in penalties in 2024 for past non-compliance but hasn’t reapplied. The bottom line: unless they’re willing to become Indian financial institutions, they won’t return.What Should You Do Now?
If you’re trading crypto in India, your only safe path is to use an FIU-registered exchange. Here’s what to do:- Move all funds from banned exchanges to CoinDCX, WazirX, or another registered platform.
- Download your trade history from old accounts and calculate gains manually.
- File your crypto taxes by July 31, 2026, using Form ITR-2 with Schedule CG.
- Keep records for six years-FIU-IND requires exchanges to store data that long, and tax authorities can audit back five years.
- Never use a VPN to access banned platforms for trading. It doesn’t make you safer-it makes you invisible to the law.
Is Crypto Still Legal in India?
Yes. But only if you use the right platforms. The government hasn’t outlawed crypto. It’s just saying: if you want to trade here, you play by our rules. That means registering, reporting, and paying taxes. The era of offshore exchanges dominating India’s crypto market is over. The winners aren’t the ones with the most coins or the lowest fees-they’re the ones that followed the law.Are Binance and KuCoin banned in India?
Yes. Both Binance and KuCoin are blocked in India because they never registered with FIU-IND. Their websites are inaccessible, INR deposits are blocked, and Indian users can’t withdraw funds. These platforms remain banned unless they comply with Indian reporting laws.
Is it illegal to use a banned crypto exchange in India?
Using a banned exchange isn’t a criminal offense, but it’s legally risky. You can’t withdraw INR, you won’t get tax reports, and if the tax department audits you, you’ll have no proof of transactions. You’re also on your own if your account gets frozen or hacked.
Can I still trade crypto in India legally?
Yes. You can trade crypto legally through FIU-IND registered exchanges like CoinDCX, WazirX, ZebPay, Unocoin, and Mudrex. These platforms accept INR deposits, provide tax reports, and comply with Indian law.
What’s the tax rate on crypto in India?
Crypto gains are taxed at a flat 31.2% (including cess). There are no deductions or loss offsets. Only FIU-registered exchanges can issue tax statements. If you use a banned platform, you must track and report all trades yourself.
Do I need to report crypto trades on my tax return?
Yes. All crypto gains, whether from domestic or foreign exchanges, must be reported in your annual income tax return under Schedule CG. Failure to report can lead to penalties up to 60% of the unreported gain under Section 158BA(7).
What happens if I don’t pay crypto taxes in India?
The tax department can initiate a reassessment, demand payment with interest, and impose penalties up to 60% of the tax evaded. In serious cases, they may investigate for money laundering under the Prevention of Money Laundering Act (PMLA), especially if large sums moved through unregistered exchanges.
Can I use a VPN to access Binance in India?
You can use a VPN to access blocked sites, but it doesn’t make it safe. You still can’t withdraw INR, you won’t get tax reports, and your transactions remain unreported. The Indian government doesn’t track individual users using VPNs-but your tax liability doesn’t disappear.
I'm a blockchain analyst and crypto educator who builds research-backed content for traders and newcomers. I publish deep dives on emerging coins, dissect exchange mechanics, and curate legitimate airdrop opportunities. Previously I led token economics at a fintech startup and now consult for Web3 projects. I turn complex on-chain data into clear, actionable insights.