US-based cryptocurrency exchange Coinbase is preparing to re-enter the Indian market nearly two years after its exit. The company has begun discussions with potential partners to introduce UPI-linked services in the country, an industry source familiar with the matter, who wishes to be anonymous, told Gadgets 360. Coinbase first attempted to enable UPI-based crypto transactions in India in 2022. However, the National Payments Corporation of India (NPCI) deemed the service “unrecognised,” resulting in its suspension just hours after launch.
Coinbase has recently begun discussions with Indian crypto firms to explore potential partnerships. Company officials are scheduled to visit India later in March to advance these talks, the source told Gadgets 360.
To resume operations in India, Coinbase must first register with the country’s Financial Intelligence Unit (FIU). In March, company representatives are planning to meet with FIU officials to gain a detailed understanding of the registration process. The approval could take several months, potentially extending until the end of the year.
In India’s centralised exchange market, Coinbase aims to compete with platforms like CoinSwitch and CoinDCX. To support its UPI-enabled crypto transactions, the company is prioritising partnerships with local firms for key services such as KYC verification—an essential step it overlooked during its previous attempt in 2022, the source added.
Coinbase did not immediately respond to a request for a comment on the matter.
History of Coinbase in India
In April 2022, the exchange held an event in Bengaluru to launch its services in India. CEO Brian Armstrong was part of the event where he shed light on India being a promising market for the company. It was during this event that the exchange announced that it would let its Indian users buy crypto assets using India-owned real-time peer-to-peer money transfer system known as the UPI.
Following the announcement, the NPCI said that the exchange had not taken any permission to integrate UPI with crypto purchases, and therefore, directed to halt the feature.
During Coinbase’s Q1 FY22 earnings call, Armstrong stated that the RBI had been putting some ‘informal pressure’ on the company to disable some services in the country.
In September 2023, the exchange finally announced that it was stopping its services in India – asking its customers to withdraw their funds.
Since then, Coinbase has largely stayed away from the Indian crypto market, where regulatory frameworks for the sector remain under discussion.
At the India Blockchain Week held in December 2024, Gadgets 360 spoke with Jesse Pollak, the creator of Coinbase’s Base blockchain about India related plans. Pollak praised Indian Web3 developers as highly skilled and passionate about contributing to the global on-chain economy. However, he pointed out that beyond regulatory uncertainty, the lack of borrowing and credit facilities poses a major challenge for the country’s Web3 sector.
Meanwhile, it remains unclear whether India will permit crypto exchanges to integrate UPI with their services. Given UPI’s widespread adoption, authorities appear cautious, aiming to prevent reckless investments in highly volatile, largely unregulated crypto assets that offer transaction anonymity.
In 2023, the Bharat Web3 Association urged authorities to consider integrating UPI with crypto services. Supporting their proposal, the organisation reportedly highlighted that crypto entities were adhering to the Prevention of Money Laundering Act (PMLA) and registering with the Financial Intelligence Unit (FIU). These compliance measures, they argued, provided a strong case for the government to permit UPI-backed crypto transactions.
