Coinbase has registered with India’s Financial Intelligence Unit (FIU), enabling it to finally, legally offer crypto trading services in the country. Notably, this registration is a mandatory compliance step for virtual digital asset service providers in the country, ensuring adherence to anti-money laundering regulations and other legal requirements.
By registering with the FIU, Coinbase will now be operating within India’s regulatory framework, aiming to provide secure and compliant crypto trading services to Indian users.
The crypto exchange aims to launch its retail services later this year, with intentions to expand into additional investment products later. This move reflects a growing interest in cryptocurrencies, especially among young Indians.
“India represents one of the most exciting market opportunities in the world today. The country has rapidly grown into an on-chain development hub, with its share of global developers increasing from 3% in 2018 to 12% in 2023. Among emerging markets, India now boasts the highest concentration of talent in the on-chain space,” the crypto exchange said in a blog post.
Coinbase had initially tried to enter the Indian market in 2022 by integrating with the Unified Payments Interface (UPI), the most popular digital payment system in India. This would have allowed Indian customers to buy cryptocurrencies using Indian rupees.
However, just three days after launch, Coinbase had to disable the UPI service because the National Payments Corporation of India (NPCI) stated that it was ‘not aware’ of any crypto exchange using the system. This revealed that Coinbase did not have the necessary approvals, forcing it to halt the service. Now, Coinbase is making a second attempt to enter the Indian market, likely with a different approach to avoid similar regulatory issues.
This development is noteworthy as the cryptocurrency market in India is projected to witness significant revenue growth, reaching a staggering amount of $6.4 billion by 2025. Despite India’s stringent tax regime on cryptocurrency gains – including a 30% tax on profits and a 1% transaction levy – the country’s large and growing market presents significant opportunities for crypto exchanges.
Also, the Indian government has been refining its stance on digital assets. While comprehensive regulations are still under development, recent actions indicate a shift toward acknowledging and regulating the crypto industry.
Meanwhile, with FIU registration, Coinbase joins other exchanges like Binance, Bybit, and KuCoin in adhering to India’s regulatory framework. Talking about Coinbase itself, the company was founded in 2012 by Brian Armstrong. The American cryptocurrency exchange has a large user base, estimated to be around 108 million users as of 2024. It is one of the world’s largest Bitcoin custodians, managing over $400 billion in assets.
