Bybit, the second largest centralized exchange by daily trading volume, announced that it will temporarily suspend cryptocurrency trading services in India due to changing regulatory requirements.
The suspension will take effect on January 12 at 8:00 a.m. UTC and will affect cryptocurrency trading, new account registrations, and trading on various products.
Legal Challenge to Bybit in India
Company evidence Commitment to compliance with applicable laws and regulations is the reason for this decision. Although trading services will be temporarily suspended, the exchange insists users can still withdraw funds without restrictions.
“We have taken this measure while continuing to work closely with the regulator to complete the registration of digital asset offerings in India, which we expect to complete within next few weeks,” Bybit wrote.
However, it is important to note that the exchange claims this suspension is only temporary. It could be because they are trying to resolve the legal issue before continuing operations.
“Bybit is working on getting the license and expects to complete the process within a few weeks,” said an Indian crypto influencer named ‘Berit’ speak.
This is not the first time Bybit has faced a legal challenge. In August 2024, the platform ceased operations in France due to regulatory pressure. At the time, Bybit said it was working to obtain the necessary licenses to resume service in the region.
Additionally, the Japanese Financial Services Agency recently warned Bybit and four other international exchanges about operating without proper registration.
The regulatory environment in India is increasingly strict for cryptocurrency companies. Authorities have been aggressively examining tax compliance, uncovering $97 million in unpaid taxes from cryptocurrency exchanges, including Binance and WazirX.
Binance is said to owe $85 million, while WazirX and others have partly settled their tax liability.
In recent months, Indian authorities have also expressed support for banning personally identifiable cryptocurrencies such as Bitcoin and Ethereum. They promote Central Bank Digital Currencies (CBDCs) as a safer and more efficient option to promote financial inclusion.
Officials argue that the risks associated with private digital assets, including stablecoins, outweigh their potential benefits.
Despite these challenges, the cryptocurrency market in India continues to grow. In 2024, the country ranked in the top 10 on the Global Crypto Adoption Index, highlighting the growing interest and participation of Indian users in the digital assets sector.
