Binance tightens rules for India users, falls in line

Since this week users have to disclose more information for every crypto withdrawal and deposit- transactions that regulators fear may obfuscate money trails.

Thanks to the border-less feature of the virtual digital asserts (VDAs), such crypto transfers – where coins flow in and out of users’ wallets with exchanges- have also drawn the attention of central banks, particularly in countries like India with foreign exchange restrictions.Indian users are estimated to constitute about 7-9% of Binance’s total registered customer base of 300 million.

“In adherence to local regulatory requirements, Binance will gradually introduce changes to crypto withdrawal and deposit procedures for Indian users,” said a Binance update that was issued in the weekend and came into effect from June 22, 2026.

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more info needed for withdrawals, Deposits

The regulatory concerns on cross-border crypto flows stem from the nature of the asset and the possible transactions: technically, deposits into the exchange wallets of a user in India can be made by any person or entity located anywhere in the world; similarly, coins once withdrawn into self-hosted or private wallet can be moved anywhere.

Thus, a person planning to circumvent exchange control regulations and outbound remittance limits may be tempted to use cryptos instead of banking channels.Binance, which supports almost 350 cryptocurrencies, however has not imposed any limits on deposits and withdrawals. However, crypto circles do not rule out more changes in future. The transfer procedures seem to have been introduced with a view to gradually align with travel rules requirements of FIU India which are slightly more cumbersome than a few other jurisdictions, said Purushottam Anand, founder of Crypto Legal.

IDs of BENEFICIARIES, ORIGINATORS
According to the new rules, after confirming withdrawal details, users will have to provide additional information on the beneficiary-such as name, country of residence, city/village/town, and name of the crypto exchange where the beneficiary has an account; the person withdrawing will have to spell out whether the cryptos are being moved into a self-hosted wallet or into a wallet hosted by a virtual asset service provider.

In receiving crypto assets (which are deposited) from another exchange or self-hosted wallet into a Binance wallet, the user will have to furnish information on the originator: name, permanent account number or national ID number, country of residence, and complete address along with pin code.

Viewed against the backdrop of recent enforcement and regulatory developments, the Binance update appears less like a routine platform change and more like a move towards comprehensive transaction traceability, said a senior lawyer practicing Foreign Exchange Management Act (FEMA). “The emphasis is no longer confined to withdrawals. By seeking detailed originator information for inbound deposits, exchanges are effectively creating an audit trail for cross-border crypto flows, a subject that has increasingly attracted the attention of Indian regulators,” said the person who refused to be named.

A Binance spokesperson did not comment on the development till the time of going to press.