Binance is the largest P2P USDT/INR venue and a regular subject of 'is it legal' questions. The answer in 2026 is straightforward: yes, with caveats.
What happened in early 2024
December 2023: FIU-IND issued show-cause notices to 9 foreign exchanges including Binance for unregistered operation under PMLA. January 2024: their domains were blocked in India.
Binance responded by registering with FIU-IND, paying an ₹18.82 crore penalty, and resuming services. The block was lifted in mid-2024. Indian users now access Binance through the regular binance.com domain or the registered domestic entity.
What 'legal' means here
Binance operates under PMLA-compliant KYC and reporting. Indian users transact normally with Indian-rupee P2P functionality. TDS is deducted by Binance at 1% on Indian users' VDA transfers.
There is no separate SEBI-style 'crypto exchange license' in India. FIU registration is currently the highest bar, and Binance has cleared it.
Caveats
Binance is foreign-domiciled. Disputes are governed by Binance's terms (typically Singapore arbitration). Indian consumer protection law has limited reach.
Banking-channel friction can still happen. Some Indian banks flag UPI transactions to known Binance merchant accounts; this is a private-bank policy issue, not a Binance legality one.
Key takeaways
- Binance is registered with FIU-IND and operates legally in India in 2026.
- Brief block in early 2024 ended after registration + penalty.
- TDS is auto-deducted; AIS reporting is in place.
- Foreign-domicile means dispute resolution sits outside Indian courts.
