India’s Financial Intelligence Unit issued new onboarding rules for regulated crypto exchanges, tightening know‑your‑customer and anti‑money‑laundering checks by requiring live selfie verification and location proof, according to a report. The changes aim to prevent fraud and improve traceability of onchain activity.
The guidelines require exchanges to verify live selfies with software that monitors eye and head movements to block AI deepfakes. Platforms must also capture geolocation, IP address and a timestamp when accounts are created.
Exchanges will confirm bank accounts by sending a small transaction to satisfy anti‑money‑laundering checks. Users must provide additional government‑issued photo ID and verify both email and mobile numbers to open accounts with registered platforms.
Officials from the Income Tax Department told lawmakers that cryptocurrencies and decentralized finance hinder tax enforcement because decentralized exchanges, anonymous wallets and cross‑border transfers complicate taxation. Under India’s Income Tax Act, gains from cryptocurrency sales are taxed at 30% with only cost basis allowed as a deduction.
Crypto traders in the country are not allowed to harvest losses to offset gains from other crypto sales. An image linked to a social post is cited as source material here. Read the editorial policy here.
