How tech-savvy traders are bypassing govt's crypto block
New Delhi: India’s ministry of electronics and information technology (Meity) is yet to find a solution to local cryptocurrency users accessing global crypto exchanges via virtual private networks (VPN). The government had blocked web and app store access to Binance, Kucoin, Huobi and six other exchanges on 12 January.
“We are aware of access to offshore crypto platforms being available through VPNs, and we are working to figure out a way around it," Meity secretary S. Krishnan said.
“However, it isn’t a question of enforcing regulatory roadblocks; we will need to find a technological solution to block offshore exchanges despite VPNs." Tech-savvy users see the IP block as a minor hindrance that they are willing to overcome, especially because all crypto trades on Indian exchanges attract a 1% tax deducted at source (TDS), and there is greater liquidity on global cryptocurrency exchanges. To be sure, the use of VPNs could slow the minor revival seen on Indian cryptocurrency exchanges when the global IPs were blocked.
Even a first-in-two-years bull run in crypto, especially in the US, doesn’t guarantee higher volumes because users can easily bypass Indian exchanges and transact directly with the likes of Binance (the world’s top crypto exchange with daily average trading volume of $14.86 billion, as per tracker Coinmarketcap) and others. The blocking of global crypto IPs followed a recommendation to that effect on 28 December from the finance ministry’s financial intelligence unit (FIU) due to the exchanges’ non-compliance with India’s Prevention of Money Laundering Act (PMLA), 2002.
The FIU notice, and the subsequent blocking, did help in reviving Indian exchanges’ volumes to a certain extent. Minal Thukral, executive
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