1. User Registration and KYC Verification

Every Indian crypto exchange requires new users to:

• Sign up with email or mobile number

• Complete KYC (Know Your Customer) with PAN card, Aadhaar, and sometimes bank proof

• Verify mobile and bank account for INR withdrawals

🔒 Why It Matters: This ensures compliance with government rules and helps prevent fraud and money laundering.

 2. INR Deposit via Bank or UPI

Once verified, users can:

• Deposit INR using UPI, IMPS, NEFT, or bank transfer

• Funds are reflected in their wallet balance on the app

Most exchanges offer instant deposit options, while some may take a few hours.

 3. Buy, Sell, or Trade Cryptocurrencies

Users can:

• Buy cryptocurrencies like BTC, ETH, MATIC, SHIB at real-time market rates

• Trade crypto-to-crypto pairs (e.g., BTC to USDT)

• Place limit or market orders, similar to stock trading platforms

Some exchanges also offer:

• Staking

• Margin trading

• SIPs in crypto

• Fixed-income plans

 4. Storage & Wallet Options

Exchanges offer:

• Hot wallets: Online wallets for instant trading

• Cold storage (offline): Used for securing user funds from hacks (used by CoinDCX, WazirX, ZebPay)

💡 Users can also withdraw to private wallets (like Metamask or Ledger) for added security.

 5. INR Withdrawal to Bank Account

After selling crypto:

• INR gets credited to the user’s INR wallet

• Users can withdraw to their linked bank account

Most platforms charge nominal withdrawal fees, and transfers are usually processed within a few hours to 24 hours.

 Cryptocurrency Regulation in India (As of 2025)

While cryptocurrency is not banned in India, it is not recognized as legal tender either. The government has taken a cautious approach by regulating how it’s taxed and traded:

 Key Regulatory Highlights:

 Legal to Trade:

Yes, you can buy, sell, and hold crypto in India legally through KYC-compliant exchanges.

 Taxation Rules:

• 30% flat tax on profits from crypto trading

• 1% TDS (Tax Deducted at Source) on crypto transfers above ₹10,000 per transaction

• Losses from one coin can’t be set off against gains in another

 KYC & AML Enforcement:

• Exchanges must verify user identity using PAN, Aadhaar, and bank details

• They must follow Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) protocols

 FIU Registration Mandatory:

In 2023, the government made it compulsory for all Indian exchanges to register with the FIU-IND (Financial Intelligence Unit of India) for transaction monitoring.

 No RBI License Yet:

RBI has not yet issued licenses to crypto exchanges, but regulatory clarity is expected as India works on its Crypto Regulation Bill and Digital India initiatives.

 Final Thoughts: How to Stay Safe While Using Crypto Exchanges

• Always use FIU-registered, KYC-compliant platforms (e.g., CoinDCX, WazirX, ZebPay)

• Avoid P2P or offshore exchanges unless you fully understand the risks

• Declare crypto profits while filing Income Tax Returns

Enable 2FA and withdrawal whitelists to secure your account