India Aims to Create Comprehensive Database of Crypto Exchanges to Fight Illicit Use

India Aims to Create Comprehensive Database of Crypto Exchanges to Fight Illicit Use

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The Indian government is working to build an extensive global database documenting all cryptocurrency exchanges, including those operating on the dark web, to enhance its capacity for detecting crypto-related crimes.

According to officials, the database compiling information on global crypto trading platforms is expected to launch by the end of the current fiscal year.

The repository will play a key role in providing vital data on crypto assets to assist law enforcement investigations.

Deterring Crypto Use in Illegal Activities

By consolidating exchange information in one unified database, Indian authorities aim to improve monitoring of cryptocurrencies potentially used for unlawful activities like money laundering, tax evasion and drug trafficking.

Agencies including the Enforcement Directorate, Income Tax Department, and Central Bureau of Investigation are expected to leverage the database for tracking and prosecuting crypto-linked financial crimes.

Officials stated global cooperation will be crucial to document lesser-known dark web exchanges hidden via anonymity tools.

Urgent Need to Plug Crypto Reporting Gaps

India’s push comes as global regulators rush to plug information gaps on opaque crypto transactions.

The Organization for Economic Cooperation and Development recently introduced the Crypto-Asset Reporting Framework (CARF) to formulate new tax reporting standards for crypto assets.

Financial Intelligence Unit (FIU) officials in India noted that crypto-related drug trafficking totalled over $3.3 billion between 2019-2021.

By pooling exchange data to trace illicit flows, India aims to avoid crypto from enabling greater criminal activity unchecked. But balancing transparency with surveillance concerns will be critical.