Global crypto exchange Coinbase is preparing to make another attempt to enter the Indian market, over a year after it was forced to halt operations in the country.
The crypto exchange is in discussions with Indian regulators, such as the Financial Intelligence Unit, to secure the necessary approvals for a relaunch, a source familiar with the matter told Decrypt.
Coinbase is planning to relaunch the same centralized exchange platform that was initially introduced in the country years ago, seeking to compete with local players such as CoinDCX and CoinSwitch.
“They want to do the same thing this time, but with local partners on board and a more clear strategy, which they didn’t have last time,” the source said.
Executives from Coinbase are expected to visit India in March to meet with the FIU as part of the company’s efforts to meet regulatory requirements.
Once the necessary approvals are obtained, the company aims to proceed with its relaunch, although the timing will largely depend on the completion of the regulatory process, which could stretch into the latter part of the year, the source said.
TechCrunch was the first to report on Coinbase’s efforts to return to India on Wednesday.
Coinbase in India
In 2022, the exchange launched with support for India’s United Payments Interface system but was forced to suspend those services after three days when the National Payments Corporation of India refused to recognize Coinbase’s operations due to regulatory concerns.
Following those struggles, by September 2023, Coinbase announced that it would discontinue all its operations in India, notifying some customers through email.
Exchanges in India have faced significant regulatory hurdles over the last few years as the country grapples with how best to regulate the industry.
Economic Affairs Secretary Ajay Seth recently confirmed that India is revisiting its crypto stance, influenced by changes in other countries’ approaches to digital assets, but a tax burden of 30% on trading, selling or spending cryptocurrency persists.
In June 2024, the FIU targeted nine off-shore exchanges, including the world’s largest crypto exchange, Binance, over allegations of operating in violation of local anti-money laundering regulations.
Binance complied with the regulatory requirements, paid the $2.25 million fine, and resumed operations in India after a seven-month hiatus.
India, despite its complex regulatory environment and lack of a clear framework, continues to lead globally in crypto adoption.
In 2024, India maintained its top position in Chainalysis’ Global Crypto Adoption Index, surpassing countries including Nigeria, Vietnam, Indonesia, and the U.S.
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