The Indian government has taken a firm stance on cryptocurrency activity in recent years.
Cryptocurrency exchange Coinbase revealed that it suspended its trading operations in India due to unofficial pressure from the Reserve Bank of India (RBI).
Like many central banks worldwide, the RBI has taken a strict approach to crypto trading. At one point, the RBI barred financial institutions from participating in crypto-related services.
Coinbase launched its services in India on April 7 but reversed the decision three days later. The Coinbase app had allowed users in India to buy crypto tokens using UPI, India’s widely used payment infrastructure developed by a consortium of retail banks.
UPI declined to recognize support for the Coinbase app, which prompted the exchange to retract its initial rollout.
Coinbase CEO Brian Armstrong confirmed that informal pressure from the RBI was the reason the company halted operations in India. He said:
“I think, to take a step back and look at the bigger picture, one of our theories — and my theory — is that actions generate information. So it’s not always obvious when we enter countries around the world, everyone has a different level of education about crypto. There is a lot of work to be done to meet with policymakers around the world and teach them about AML capabilities and the positive benefits. People in these countries generally really want crypto. So to me, that suggests that in most free and democratic places around the world, crypto will eventually be regulated and legal, but it will take a long time for them to accept it.”
Despite these challenges, Armstrong said Coinbase still plans to launch in India. He added that the company is exploring the best way to move forward and remains committed to establishing operations in the country. He concluded:
“We will do the launch because it forces the conversation to happen. Now the press is talking about it in India. There are now meetings that will discuss how we get to the next steps. So generally, that is our approach to international expansion.”