Coinbase is gearing up for a reentry into the Indian market after more than a year of halted operations, coinciding with India’s ongoing reassessment of its cryptocurrency regulations. The leading U.S. crypto exchange is reportedly engaged in discussions with India’s Financial Intelligence Unit (FIU), the government body responsible for monitoring financial transactions, as it works to align with local compliance requirements, according to TechCrunch sources.
The move follows Coinbase’s rocky history with Indian authorities. The exchange initially launched in the country in 2022, integrating the widely used Unified Payments Interface (UPI) to facilitate transactions. However, within days, it was forced to suspend services when India’s National Payments Corporation declined to acknowledge its presence. CEO Brian Armstrong later revealed that Coinbase had encountered “informal pressure” from the Reserve Bank of India, making operations increasingly difficult.
India’s regulatory environment remains one of the most stringent for crypto businesses. Since 2022, the government has imposed a 30% tax on crypto gains along with a 1% transaction levy, significantly discouraging trading activity. Additionally, the FIU has taken a firm stance against unregistered exchanges, initially identifying major platforms such as Binance and Kraken as non-compliant before they obtained the necessary registrations. As a result of these strict policies, many firms have been reluctant to invest in India’s virtual asset sector.
Despite a population of 1.4 billion, India’s crypto market remains relatively underdeveloped, largely due to the ongoing regulatory uncertainty. However, Coinbase’s renewed interest in the country aligns with its broader global expansion strategy. The company recently secured a license to operate in Argentina, reinforcing its commitment to extending its reach into international markets.
As regulatory discussions in India continue, Coinbase’s potential return could signal a shift in the landscape for crypto businesses operating within the country. Whether the exchange successfully reestablishes itself will depend on the government’s evolving stance on digital assets and its willingness to foster a more accommodating environment for industry players.
By Alejandro Silva Ramírez, Crypto Analyst & Columnist