Binance faced new regulatory pressure today primarily due to a major tax evasion investigation launched by Indian authorities targeting around 400 Binance traders. This investigation focuses on whether these traders used Binance’s platform, particularly peer-to-peer (P2P) payment methods, to conceal transactions and evade taxes by routing payments through domestic bank accounts and platforms like Google Pay. Indian tax departments across various cities have been instructed to report their findings by October 17, 2025, signaling a coordinated and serious crackdown on crypto tax compliance in India[1].
This regulatory pressure on Binance in India is part of a broader global trend where governments are intensifying scrutiny of cryptocurrency exchanges and traders to enforce tax laws and financial regulations. The Indian government’s actions reflect its determination to clamp down on tax evasion in the crypto sector, which has grown rapidly but often operated in regulatory gray areas. The investigation into Binance’s P2P transactions is significant because these transactions can be harder to track and regulate compared to traditional exchange trades, raising concerns about their potential misuse for illicit financial activities[1].
In addition to the tax investigation in India, Binance has recently been under pressure due to a severe market crash and platform issues that occurred on October 10, 2025. This crash was triggered by geopolitical tensions, specifically a statement by U.S. President Donald Trump announcing plans to impose 100% tariffs on all Chinese goods starting November 1, 2025. The announcement caused a sharp drop in Bitcoin’s price and a massive liquidation event across the crypto market, wiping out nearly $20 billion in leveraged positions globally. Binance was heavily impacted, with about $2.3 billion of liquidations occurring on its platform alone. The extreme volatility led to technical malfunctions on Binance, including delays in order execution, API latency spikes, and display issues, which affected many users and caused some altcoins to crash to zero temporarily due to automatic liquidation of collateral[2][4][5][6].
These technical and market issues have also drawn regulatory attention and criticism. Binance announced plans to compensate users who suffered verifiable losses directly linked to platform failures during the crash, but this incident has raised questions about the exchange’s risk management and operational resilience. Industry figures and other exchange CEOs have called for regulatory probes into the events surrounding the crash, suggesting that the scale and nature of the liquidations might involve more than just market volatility, possibly including manipulation or inadequate platform safeguards[4][5].
Furthermore, Binance continues to navigate ongoing regulatory challenges globally. For example, in the United States, Binance has been under a compliance monitor imposed as part of a $4.3 billion settlement, and there are reports that the Department of Justice is considering lifting this monitor, indicating ongoing negotiations and regulatory oversight[7]. In Europe, regulatory frameworks like the Markets in Crypto-Assets Regulation (MiCA) are evolving to address risks associated with stablecoins and cross-border crypto activities, which indirectly affect Binance and other major exchanges operating in or serving European customers[3].
In summary, the new regulatory pressure Binance faces today is multifaceted. The immediate trigger is the Indian tax evasion investigation targeting Binance traders and the platform’s role in facilitating potentially illicit P2P transactions. This comes amid a backdrop of recent market turmoil that exposed technical vulnerabilities on Binance’s platform, prompting calls for regulatory scrutiny. These developments highlight the increasing global regulatory focus on Binance as one of the largest cryptocurrency exchanges, reflecting broader efforts by governments to impose stricter controls on crypto trading, tax compliance, and market integrity.