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FIU Tightens KYC and AML Rules for Crypto Exchanges

12 January 20261 min read
BANKING & FINANCEFIU Tightens KYCand AML Rules forCrypto Exchanges12 January 2026safalsetu.com

Why in the news

The Financial Intelligence Unit (FIU) tightened KYC and AML rules for crypto exchanges on 8 January.

Key facts

  • Exchanges must register with FIU as reporting entities, file regular suspicious-transaction reports and keep customer transaction records.

Data an exchange must collect

ItemRequirement
IdentityCustomer’s PAN
Face checkSelfie with liveness detection
OnboardingLatitude, longitude, date and timestamp
DeviceUser’s IP address
Bank linkAccount verification via penny-drop

Restricted activities

  • ICOs and ITOs are discouraged.
  • Facilitating tumblers, mixers and anonymity-enhancing tokens is prohibited.

Background

  • Exchanges fall under the PMLA.
  • Crypto is not legal tender and is taxed under the Income-Tax Act.

Exam angle

  • Bank verification: penny-drop; law: PMLA.

Test yourself

1. Which body issued the updated KYC and AML guidelines for crypto exchanges on 8 January?

The FIU, functioning under the Ministry of Finance, issued them.

2. How must crypto exchanges verify a customer's bank account under the new norms?

The guidelines mandate bank account verification by the penny-drop method.

3. Under which law are crypto exchanges regulated for AML purposes in these notes?

Crypto exchanges are regulated under the Prevention of Money Laundering Act.

This topic is part of Daily Current Affairs 11 & 12 January 2026 (23 topics).

All topics of the dayDay quizJanuary 2026

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