Trade in cryptocurrencies will fall within the ambit of the Prevention of Money Laundering Act (PMLA), the Union Ministry of Finance has announced. It said the PMLA has been applied to crypto trading, safekeeping and related financial services. After this, Indian crypto exchanges will have to report suspicious activity to the Financial Intelligence Unit India.

The exchange between virtual digital assets and fiat currencies, the exchange between one or more forms of virtual digital assets and the transfer of digital assets will be covered under money laundering laws, the notification dated March 7 stated. The government is yet to finalise legislation and regulations surrounding cryptocurrencies even as the Reserve Bank of India has sought a ban saying they are akin to a Ponzi scheme.