India's USDT premium exceeds 8.5% after enforcement raids

The premium for purchasing the stablecoin Tether (USDT) with Indian rupees surged above 8.5 percent this week, a sharp increase attributed to a sudden tightening of local supply following recent regulatory enforcement actions. The price spike has raised costs for traders and highlighted the market impact of regulatory uncertainty surrounding cryptocurrency and cross-border remittances.

On June 28 and 29, USDT was quoted locally at approximately 102.88 rupees, while the interbank U.S. dollar rate was near 94.65 rupees. This gap far exceeds the typical premium range of 3 to 4 percent, indicating a significant shortage of accessible USDT within India. The increase followed searches conducted by India's Enforcement Directorate (ED) on June 19 targeting several Bengaluru-based firms. The agency alleged these entities facilitated unauthorized outward remittances using stablecoins, bypassing foreign exchange regulations under the Foreign Exchange Management Act (FEMA). The suspected transaction value involved in the case exceeds 2,500 crore rupees, and bank balances of approximately 6 crore rupees have been restrained, according to the ED.

The named firms include Transak Technology...