Coinbase Secures Regulatory Approval in India, Plans Re-Entry into the Market

U.S.-based cryptocurrency exchange Coinbase has received approval from India’s Financial Intelligence Unit, allowing the platform to offer crypto trading services in the country once again. The move signals Coinbase’s intent to re-enter the Indian market after a failed attempt in 2022. In a March 11 blog post, Coinbase confirmed that it plans to launch retail crypto trading services in India later this year, with further investments and products to follow in the coming months.

A Strategic Move for Growth

Coinbase’s regional managing director for APAC, John O’Loghlen, emphasized the importance of India as a key market. He described India as "one of the most exciting market opportunities in the world today" and highlighted the country's growing embrace of regulation and innovation in the crypto and blockchain sectors.

"India represents a vibrant, fast-growing market, and we’re proud to deepen our investment here in full compliance with local regulations," O’Loghlen said in the announcement.

The move comes as India’s developer community has seen significant growth, with the country’s share of global developers rising from 3% in 2018 to 12% in 2023. Coinbase sees this increase in local talent and entrepreneurial energy as a major advantage and a natural fit for the company’s expansion efforts.

“India’s developer community and entrepreneurial energy are unmatched,” said O’Loghlen. "But too often, young Indian entrepreneurs have felt forced to look abroad to build global companies. Crypto can change that."

The Return After 2022 Setback

Coinbase's previous attempt to launch in India faced regulatory hurdles. In April 2022, the company introduced support for India’s popular UPI payment system but was forced to suspend operations just three days later. This followed resistance from the National Payments Corporation of India, which refused to approve Coinbase’s services. Additionally, reports suggested that the Reserve Bank of India had applied informal pressure to prevent the exchange’s operations.

However, Coinbase remains undeterred. In its latest blog post, the company highlighted India’s evolving regulatory framework for cryptocurrency, positioning the country as one that is increasingly "embracing regulation and encouraging innovation" in the crypto space. With the recent approval from India’s financial regulators, Coinbase is optimistic about its prospects and is planning a careful re-entry into the market.

A Strategic Investment Amidst Market Turbulence

Coinbase's re-entry into India coincides with some positive movements for the exchange outside the country. Just a day before the announcement, Cathie Wood’s ARK Invest acquired more than 64,000 shares of Coinbase, worth approximately $10.5 million. The purchase came despite a 17.58% drop in Coinbase’s stock, which fell amid broader market volatility on March 10, according to Nasdaq data.

This renewed interest from major institutional investors further bolsters Coinbase’s position in the market, signaling confidence in the company’s long-term prospects.

Looking Ahead

With its sights set on India’s dynamic market and thriving startup ecosystem, Coinbase plans to roll out retail trading services first, with plans to introduce more products and services down the line. The company’s ability to navigate regulatory challenges and build on the country’s growing developer talent pool may position it for success in the fast-evolving Indian crypto landscape.

As India continues to position itself as a key player in the global crypto space, Coinbase’s return marks a significant milestone in the exchange’s global expansion strategy.