Coinbase Eyes India Return Amid Crypto Boom
Coinbase is resuming operations in India reluctantly more than a year after it has permanently ceased operations within the world’s most populous country.
The American crypto exchange is interacting with multiple authorities in India, including FIU, which is India-based agency of Government of India, that scrutinizes financial transactions, according to two sources familiar with the matter and who spoke on condition of anonymity because deliberations are ongoing and private.
Coinbase is also involved in India after a tumultuous history in the South Asian market. Binance, the world’s largest cryptocurrency exchange, resumed operations in India last August after registering itself with the FIU following a regulatory halt of seven months.
The establishment of this landmark was a precedent for foreign crypto exchanges that seek to operate in India.
Coinbase’s last effort to launch its services in India was abruptly terminated in 2022.
Much fanfare was previously heaped on the launch in April of the same year, after much singing and dancing, when people were told that UPI payments would support the digital currency.
Three days later, the National Payments Corporation of India, which controls UPI, rejected Coinbase but had to be withdrawn.
In a later report, the chief executive of Coinbase, Brian Armstrong, disclosed that informal pressure from the Reserve Bank of India had been instrumental in halting the trading activity.
Although cryptocurrency trading is not illegal in the country, almost all lenders avoid rendering any services to virtual asset firms within the country to maintain their cool with the central bank, according to several entrepreneurs, investors, and other officials.
Coinbase’s timetable for relaunch will depend on how fast it can get necessary approvals, such as an operating license from the FIU.
Those covered by the earlier ruling include Kraken and Binance, which had been judged by the agency as having “illegally” operated in India. (Most of these firms have since complied with the FIU in creating broader disclosures on users’ activities.)
“Coinbase is truly excited about the prospects in the Indian market and wishes to engage itself within the necessary regulatory framework,” a spokesperson for the company said to TechCrunch in response to a query about developments concerning FIU registration.
This interest in India from the crypto exchange also coincidentally ties into its larger dreams of international expansion per remarks by Coinbase CFO Alesia Haas at a recent Goldman Sachs conference.
Moreover, Paul Grewal, chief legal officer at Coinbase, this week joined the board of directors of U.S.-India Business Council, part of the U.S. Chamber of Commerce.
“I’m honored to join the USIBC Board to help strengthen the bridge between India and the U.S. in shaping the future of finance,” he said in a statement shared by USIBC. “India has one of the largest and fastest growing web3 ecosystems in the world, with an exploding developer community, pioneering startups, and bold institutional adoption. Its share of global web3 developers has increased fourfold since 2018 up to 12%, the highest growth in developing markets.”
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