Coinbase revealed that it had halted new user registrations for its exchange platform in India back in June. Despite this measure, the company reaffirmed its commitment to India, where its operations have faced uncertainty for over a year. This statement comes in response to recent media reports, including one from TechCrunch, which had cited customer emails suggesting otherwise.
The US-based cryptocurrency exchange operator clarified that the emails sent to some users, notifying them of the need to move their funds by 25 September 2023 due to not meeting updated standards, did not accurately represent Coinbase's overall operations in India. Coinbase emphasised that they ceased new user sign-ups in India earlier this year, but they maintain a strong technical presence in the country, offering live products such as the Coinbase Wallet. The company expressed its long-term commitment to the Indian market and its ongoing exploration of ways to strengthen its presence.
Notably, Coinbase's proprietary exchange app in India has fewer than 50,000 monthly active users, according to Sensor Tower data disclosed by an industry executive.
Coinbase's efforts to establish a foothold in India have encountered challenges, with no progress made in engaging with local authorities since its launch in the country over a year ago according to TechCrunch. Coinbase officials visited India in 2022 to introduce the exchange service, which included support for the popular local payment instrument UPI. However, the body overseeing UPI immediately declined to acknowledge Coinbase's launch in India, leading Coinbase to suspend support for the payment system.
Coinbase representatives cited by TechCrunch revealed that informal pressure from the Reserve Bank of India led Coinbase to suspend its trading service in the country in May of the previous year. While cryptocurrency trading is not illegal in India and is now subject to taxation, there have been reported disagreements between the government and the Reserve Bank of India regarding the matter. This has led to what has been termed a 'shadow ban' involving subtle efforts to impede cryptocurrency-related payments, particularly those involving UPI.
For the past five years, Indian authorities have maintained a cautious approach to cryptocurrencies, emphasising the importance of international collaboration in managing these digital assets. Recently, the G20 countries released a Leaders' Declaration endorsing the Financial Stability Board's high-level recommendations for regulating and supervising crypto-assets activities and markets, as well as global stablecoin arrangements.
They called for consistent global implementation of these recommendations to prevent regulatory arbitrage and highlighted the need to address money laundering and terrorism financing risks, in alignment with FATF standards.
Every day we send out a free e-mail with the most important headlines of the last 24 hours.
Subscribe now