Compliance & Licensing
Key regulatory considerations for running a fiat-blockchain gateway in India.
Regulatory Framework
Operating a fiat-to-blockchain gateway involves navigating several compliance frameworks in India. NordStern’s architecture is designed to adapt to these requirements by separating technology orchestration from financial custody and licensing.
[!IMPORTANT] Disclaimer: NordStern is a technology infrastructure provider. We do not provide legal or regulatory advice. Operating an anchor requires consulting with qualified legal counsel in Indian fintech regulations.
1. Fiat Custody & Nodal Accounts
A primary compliance consideration is determining who holds the fiat currency (INR) and which licenses are required:
- Anchor-Owned Escrow: In this model, you connect your own bank relationships and nodal/escrow accounts to the platform. You hold the primary regulatory relationship.
- NordStern Escrow: A future model where NordStern acts as a managed-account service provider.
- Modular Integration: NordStern remains neutral. All banking and collection integrations are built behind a swappable interface so you can adapt as your licensing model evolves.
2. FIU-IND and VDA Guidelines
Under guidelines from the Financial Intelligence Unit (FIU-IND) and the Prevention of Money Laundering Act (PMLA):
- Virtual Digital Asset Service Providers (VDASPs): Businesses performing conversion between fiat and digital assets must register with FIU-IND and comply with reporting requirements.
- KYC Mandate: Before executing any deposit or withdrawal transactions, anchors must complete a Know-Your-Customer (KYC) check on the individual user.
- NordStern Integration: We provide standardized hooks to plug in local KYC providers (like HyperVerge or Signzy) and track compliance cases in your dashboard.
3. Non-Custodial Safeguards
To minimize regulatory overhead, NordStern defaults to a non-custodial structure:
- No Pool Accounts: Your corporate treasury is isolated.
- User Wallet Ownership: Users retain their own keys and authorize transactions from their own wallets.
- Regulatory Exemption: By keeping key custody and fiat pooling out of the software core, you avoid triggering heavy payment aggregator or custodian licensing requirements.