FIU-IND: Understanding Crypto Regulation and Compliance in India

When working with FIU-IND, the Financial Intelligence Unit of India that oversees anti‑money‑laundering (AML) and counter‑terrorist financing for digital assets, also known as India's FIU, it serves as the main gatekeeper for crypto compliance. Crypto regulation, the set of laws and rules that govern how tokens, exchanges, and service providers operate and Exchange licensing, the formal approval process that lets platforms offer fiat‑on‑ramps and trading services both hinge on FIU‑IND’s guidelines.

One of the core pillars FIU‑IND enforces is AML compliance, a framework requiring businesses to detect, report and prevent money‑laundering activities. This framework forces exchanges to embed robust KYC procedures, identity verification steps that confirm a user’s real‑world persona before allowing transactions. Together they create a safety net that protects investors and keeps the market transparent.

Key Areas Covered by FIU‑IND

Beyond AML and KYC, FIU‑IND monitors airdrops to stop malicious token giveaways that could be used for fraud. It also issues guidelines for stablecoin oversight, ensuring that pegged assets maintain adequate reserves and do not become systemic risks. For DeFi platforms, FIU‑IND requires a blockchain forensics approach, meaning that transaction trails must be traceable and auditable by regulators.

When a new exchange applies for a licence, FIU‑IND conducts a full exchange audit. The audit checks tech security, liquidity provision, and the ability to flag suspicious activity in real time. Successful applicants gain the right to offer fiat‑on‑ramps, which in turn expands crypto adoption across the country. The licensing process also asks for a clear digital asset taxation policy so that users know how profits will be reported.

FIU‑IND’s influence reaches into market surveillance as well. It collaborates with data‑analytics firms to spot price manipulation, pump‑and‑dump schemes, and coordinated buying or selling spikes. This cryptocurrency market surveillance helps maintain fair pricing and protects retail traders from predatory tactics.

For developers building on blockchain, FIU‑IND provides a sandbox environment where experimental tokens can be tested under a relaxed regulatory regime before a full launch. This encourages innovation while still keeping a watchful eye on potential security flaws. The sandbox also supports tokenized AI projects, giving them a clear compliance pathway.

Internationally, FIU‑IND aligns its standards with the Financial Action Task Force (FATF) and shares best‑practice data with other national FIUs. This cross‑border cooperation is crucial for tracking illicit flows that hop between jurisdictions. It also means that Indian crypto firms can more easily access global markets once they meet FIU‑IND’s criteria.

All of these pieces—regulation, licensing, AML, KYC, airdrop monitoring, and market surveillance—form a connected ecosystem that FIU‑IND manages. Below you’ll find a curated list of articles that dive deeper into each topic, from practical guides on exchange licensing to detailed breakdowns of recent airdrop scams. Use them to stay ahead of the regulatory curve and make informed decisions in the fast‑moving Indian crypto space.