Coinbase, one of the world’s leading cryptocurrency exchanges, has decided to cease operations in India. The company cited regulatory uncertainties and users not meeting their updated standards as the primary factors in this strategic move.
India Will No Longer Access Coinbase Trading Services, TechCrunch Reports
Reports on September 11 revealed that Coinbase India sent a warning email to users of this move. The email notified users that all services would stop by September 25, advising users to withdraw their funds from the exchange.
While this news appears disheartening, the service suspension move will not affect all of the company’s customers in India. Instead, the move applies only to users who failed to meet the company’s updated standards.
A Coinbase spokesperson noted that while the exchange stopped allowing new user sign-ups on the exchange in India in June of this year, the platform maintains a robust tech hub in India and offers live products, including the Coinbase Wallet.
The Coinbase spokesperson also revealed that the exchange had identified some accounts that needed to meet their updated standards during a recent routine review. He explained that Coinbase India will disable these accounts and allow customers to update their information later.
He emphasized that Coinbase is committed to India in the long term and will continue to explore ways to strengthen its presence in the market.
Meanwhile, all affected users’ funds will remain safe with the crypto exchange. All the affected users can still withdraw funds and send them to other crypto service providers until September 25.
In addition, the report stated that the crypto exchange has stopped Indian users from joining its exchange. Instead, it encouraged Indian users to download the Coinbase Wallet.
Coinbase’s Entry Into India And Regulatory Challenges
Coinbase started its services in India with a big announcement in April 2022. They initially allowed people to buy cryptocurrency using a unified payment interface (UPI) payment method.
However, shortly after, due to pressure from regulatory authorities, the company had to stop this service and turn off crypto purchases in India.
Indian users who previously purchased crypto could engage in peer-to-peer trading, exchanging their existing cryptos with others via Coinbase Wallet. However, these services are subject to standard network and transaction fees.
At the time, the exchange mentioned its dedication to collaborating with NPCI and other pertinent bodies. Also, it planned to explore alternative payment methods, although the initiative couldn’t come to fruition.
However, in May 2022, CEO Brian Armstrong said the exchange stopped its trading service in India due to informal influence from the Reserve Bank of India.
Armstrong explained that trading cryptocurrency is not against the law in India, but the country has recently begun to impose taxes on it. After deactivating UPI services last year, the exchange’s cryptocurrency services have been unavailable in India.
Some individuals within the Indian government, including those at the Reserve Bank of India, are also unsupportive of crypto. As a result, they have been quietly applying subtle pressure, often called a “shadow ban.” This informal regulatory pressure aimed to hinder certain payments using UPI, a popular payment method in India.
Featured image from Pixabay and chart from TradingView.com