India's USDT premium jumps above 8.5% after ED targets cross-border transfers

India is seeing an acute shortage of USDT, driving local prices sharply above offshore levels. The Economic Times reported that the typical 3–4% premium has widened to more than 8.5%, with USDT quoted at ₹102.88 on Saturday versus a USD/INR close of 94.65. The spike follows a recent enforcement push by India's Enforcement Directorate (ED) against entities allegedly using USDT to move money across borders. For more than two years, many members of the Indian diaspora have used USDT to route remittances outside traditional banking channels, drawn by faster settlement, lower costs and better effective FX returns. Market participants say that flow has now been disrupted. The ED argues that such cross-border crypto transfers can breach the Foreign Exchange Management Act (FEMA) even when the underlying funds are legally sourced. Industry insiders add that regulatory ambiguity has effectively become an added cost that the market is pricing in. Policy discussions are also set to accelerate. India's Parliamentary Standing Committee on Finance is scheduled to meet on July 2 with the Reserve Bank of India and ICAI to review the future direction of crypto regulation. Separately, FATF data shows stablecoins represented 84% of the $154 billion in global illegal virtual-asset transactions in 2025, reinforcing calls for India to tighten oversight of virtual digital assets (VDAs).