Regulatory Challenges and Compliance in Cryptocurrency Online Trading at ICICI Bank

Abstract

The rapid proliferation of cryptocurrency trading has introduced unprecedented regulatory and compliance challenges for banks operating in this space. ICICI Bank, one of India's leading private sector financial institutions, has faced increasing pressure to align its digital asset facilitation services with evolving regulatory mandates issued by the Reserve Bank of India (RBI), the Financial Intelligence Unit-India (FIU-IND), and the Securities and Exchange Board of India (SEBI). This paper examines the regulatory framework governing cryptocurrency trading in India, the compliance challenges encountered by ICICI Bank, and the mechanisms employed to address AntiMoney Laundering (AML) and Know Your Customer (KYC) obligations. Primary data were gathered through structured interviews with banking compliance officers. Secondary data were sourced from RBI circulars, government notifications, academic journals, and annual reports (2021–2024). Findings indicate that fragmented regulation, inconsistent enforcement, and technology limitations remain the core compliance barriers. The study recommends establishment of a comprehensive crypto regulatory framework, adoption of blockchain analytics tools, and integration of real-time transaction monitoring systems to ensure compliant and efficient cryptocurrency banking operations.