After pulling out of India in 2022, Coinbase is now planning a return. The company is in discussions with Indian regulators, including the Financial Intelligence Unit (FIU), to get the necessary approvals to operate again.
There’s no clear timeline yet, but this step makes it clear that Coinbase is serious about re-entering India’s fast-growing crypto market.
Coinbase’s previous attempt to establish itself in India was short-lived. In April 2022, the company launched with support for UPI payments, India’s most popular digital transaction system.
But just three days later, the National Payments Corporation of India (NPCI) distanced itself from Coinbase, effectively forcing the exchange to halt services. The company later faced “informal pressure” from the Reserve Bank of India, said CEO Brian Armstrong, which made it practically impossible to operate.
One major challenge remains: taxation. India’s crypto trading volume plummeted after the government introduced a 30% tax on crypto income and a 1% transaction levy in 2022. Moreover, due to regulatory ambiguity, the majority of Indian banks do not deal with crypto firms, making it very hard for exchanges to deliver seamless services.
If Coinbase returns, it can shake up the Indian crypto ecosystem, which is dominated by two local players, CoinSwitch and CoinDCX, both backed by Coinbase itself. The demise of WazirX, which had once been India’s number one exchange, has left a gap that a global player like Coinbase might step into.
Coinbase, for now, is being cautious, trying to avoid the regulatory hurdles that blocked its last bid. How well it can align with India’s evolving crypto policies will determine if it can succeed this time.
Also Read: Coinbase Can Be 21st Largest US Bank by Total Assets: Brian Armstrong
