Coinbase is actively working on re-establishing its presence in India after officially ceasing operations over a year ago. The U.S.-based cryptocurrency exchange is currently in discussions with Indian regulatory bodies, including the Financial Intelligence Unit (FIU), according to sources familiar with the matter. These discussions remain private as deliberations continue.
The company’s renewed push comes after a challenging history in India. Binance, the world’s largest crypto exchange, resumed Indian operations last August after registering with the FIU, setting a precedent for foreign exchanges seeking regulatory approval.
Coinbase initially launched its services in India in April 2022, offering support for the country’s widely used Unified Payments Interface (UPI). However, the launch was short-lived, as the National Payments Corporation of India, which oversees UPI, refused to recognize Coinbase’s operations, leading to a suspension within just three days.
Brian Armstrong, Coinbase’s CEO, later revealed that the Reserve Bank of India exerted informal pressure on the company, forcing it to halt trading. While crypto trading remains legal in India, local banks have largely avoided dealing with virtual asset firms to avoid regulatory friction with the central bank.
The timeline for Coinbase’s relaunch in India will depend on how quickly it can obtain the necessary approvals, including FIU registration. The agency had previously deemed several exchanges, including Binance and Kraken, as illegally operating in India. Many of these firms have since complied with FIU regulations, which require greater transparency regarding user activity.
A Coinbase spokesperson told TechCrunch that the company remains excited about opportunities in the Indian market and intends to fully comply with applicable regulations, though they did not provide an update on the Financial Intelligence Unit registration process.
Coinbase’s renewed interest in India aligns with its broader international expansion strategy, as highlighted by CFO Alesia Haas during a recent Goldman Sachs conference. Additionally, Coinbase’s Chief Legal Officer, Paul Grewal, recently joined the board of directors at the U.S.-India Business Council (USIBC), an affiliate 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, Grewal said in a statement. He noted that India has one of the fastest-growing Web3 ecosystems globally, with a thriving developer community and increasing institutional adoption. Since 2018, India’s share of global Web3 developers has quadrupled to 12%, the highest growth among emerging markets.
Despite India’s significance as a key international market for U.S. tech firms, the local crypto sector remains relatively small. This is largely due to the Indian government’s implementation of a 30% tax on crypto income and a 1% transaction deduction, introduced in 2022.
Coinbase’s return to India could fill a gap left by the decline of WazirX, an Indian crypto exchange that suffered a major setback after losing nearly half its reserves in a security breach. Currently, CoinDCX and CoinSwitch dominate the Indian crypto exchange space—both of which are backed by Coinbase.
