India's Crypto Exchanges Face Tightened Scrutiny with OTC Trade Disclosure Order

India's Financial Intelligence Unit (FIU-IND) has issued an order to three major crypto exchanges, requiring them to hand over records of every Over-the-counter (OTC) trade above $10,000, roughly ₹9.44 lakh. The order also mandates that exchanges trace the real people behind private companies and middlemen who made these trades.

This is the third big enforcement move from Indian regulators in less than a week, putting pressure on the Indian cryptocurrency space. The FIU-IND order covers all OTC transactions from January 2026 onward, forcing exchanges to track who really owns the money behind these trades, not just who signed the paperwork.

The OTC crackdown doesn't touch India's existing tax structure, which remains at a 30% tax on cryptocurrencies gains and 1% TDS on transfers. This rule aims at 'whale' moves in India through private deals, making it harder for shell companies or layered ownership to hide who actually controls the funds.

Exchanges will likely tighten their OTC desks fast, with more upfront identity checks before any large private trade goes through. Some traders may slow down or shift toward exchanges that already meet these standards.