Coinbase reportedly plans to return to the Indian market this year. The company is said to have already contacted India’s regulators, such as the Financial Intelligence Unit. Coinbase entered the Indian market in 2022 before suspending its operations three days later.
According to a Techcrunch report, Coinbase plans to resume operations in India after a one-year break. The crypto exchange company reportedly engaged India’s Financial Intelligence Unit to discuss its comeback.
Coinbase plans to return to the Indian market amid regulatory concerns
According to a report citing people familiar with the matter, Coinbase is said to have engaged the FIU to acquire the necessary approval to continue its operations in India. The country is currently reviewing its stance on cryptocurrencies due to the global regulatory shifts influenced by Trump’s pro-crypto policy changes.
BIG NEWS 🇮🇳
Coinbase is planning a comeback in the Indian Crypto market. pic.twitter.com/qMUkooY7JZ
— Sapna Singh (@earnwithsapna) February 13, 2025
Ajay Seth, India’s economic affairs secretary, mentioned that India’s approach to cryptocurrencies cannot be unilateral since borders do not limit digital assets. The secretary commented that more than one or two jurisdictions changed their stance toward cryptocurrency usage and acceptance.
He added that in that light, the nation would have to reevaluate its publication of a discussion paper on cryptocurrencies that was due for release in September 2024.
Coinbase’s move comes as India’s cryptocurrency market is witnessing a surge. A report from Blockchain analysis company Chainalysis revealed that India ranked high in the usage of decentralized finance assets from June 2023 to July 2024.
According to Eric Jardine, a research lead at Chainalysis, India has seen widespread adoption of different crypto assets despite the nation’s present restrictions.
Paul Grewal, Coinbase’s Chief Legal Officer, noted that India had one of the fastest-growing Web3 ecosystems globally. He added that the country had a booming developer community that could promote institutional adoption.
Grewal added that since 2018, India’s share of global Web3 developers has increased to 12%, the highest growth in emerging markets.
India has taken a tough stance against cryptocurrencies since 2018. The Financial Intelligence Unit (FIU) issued notices to show cause to nine cryptocurrency exchanges in December 2023 for non-compliance with India’s financial regulation rules. Among the affected crypto exchanges were Binance, Coinbase, and KuCoin.
Coinbase’s attempt to launch operations in India ended in 2022 after the exchange introduced the United Payment Interface (UPI) system. A few days later, India’s National Payments Corporation, which oversaw UPI, said it was unaware of any cryptocurrency exchange using a UPI payment instrument.
Crypto exchanges face regulatory pressure in India
Brian Armstrong, Coinbase’s Chief Executive Officer, said the company faced informal pressure from the Reserve Bank of India. He added the pressure led to the crypto exchange halting its operations in the country.
The report also recognized that Coinbase’s potential resumption of operations depended on how long the exchange takes to secure all the approvals, including a practicing license from the FIU.
A Coinbase spokesperson revealed that the company was excited by the opportunities presented by the Indian market and intended to comply with the requirements imposed by the FIU.
In June 2024, Binance received a $2.25 million fine from the FIU for operating in India while attempting to register with the regulatory authority. The FIU fined the exchange for violating the country’s money laundering laws.
Binance, however, resumed its operations in the country in August 2024 after a seven-month hiatus. Richard Teng, Binance’s CEO, acknowledged the exchange’s registration with the FIU, which marked an important milestone in the company’s journey.
He added the company recognized the vitality and potential of India’s VDA market. Teng said that aligning with India’s regulations allowed the exchange to tailor its services to the needs of Indian users.
The report suggested Coinbase’s re-entry into the Indian market could fill the void left by Indian exchange WazirX after it lost nearly 50% of its total reserves to a heist. The event reportedly harmed local entrepreneurs’ efforts to create a friendlier crypto regulatory environment within the country.
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