Cryptocurrency exchange Coinbase has resumed operations in India, opening its app for registration after a more than two-year hiatus. Currently, the platform facilitates crypto-to-crypto trades, but the company anticipates launching a fiat on-ramp in 2026, enabling Indian users to directly purchase cryptocurrency with Indian Rupees. This re-entry follows a period of engagement with Indian financial authorities and marks a renewed attempt to tap into the growing, albeit challenging, cryptocurrency market in the country.
Coinbase initially entered the Indian market in 2022, only to quickly encounter difficulties related to payment processing. Support for the Unified Payments Interface (UPI), a popular digital payment system, was suspended days after launch due to concerns raised by the National Payments Corporation of India (NPCI) regarding the exchange’s operations. Subsequently, in 2023, Coinbase fully ceased operations for Indian users, requesting that they liquidate their holdings on the platform.
Coinbase’s Return and Regulatory Hurdles for Cryptocurrency in India
The company’s decision to completely off-board Indian customers, as explained by APAC director John O’Loghlen at India Blockchain Week (IBW), was a deliberate strategy to establish a clean regulatory slate. O’Loghlen acknowledged this was a difficult commercial decision, considering the previously large Indian user base. This involved actively shutting down accounts held by Indian residents who were using Coinbase’s international platforms.
Coinbase has since registered with the Financial Intelligence Unit (FIU) of India, a key government agency responsible for overseeing financial transactions and combating fraud. This registration, completed earlier in 2024, preceded an early access onboarding period for users in October, culminating in the full app reopening. The process highlights the importance of complying with Indian financial regulations for operating within the country.
Navigating India’s Crypto Tax Landscape
India’s regulatory environment for digital assets remains complex. A significant impediment to widespread crypto adoption is the country’s taxation policy, which levies a flat 30% tax on all income derived from cryptocurrencies, without allowing for the offsetting of losses. In addition, a 1% Tax Deducted at Source (TDS) is applied to each cryptocurrency transaction. This high tax burden discourages frequent trading and long-term holding of digital assets.
O’Loghlen expressed Coinbase’s hope that the Indian government will consider reducing these tax rates to encourage greater participation in the cryptocurrency market. He believes that a more favorable tax regime is essential for fostering growth and attracting investment in the sector.
Investment and Expansion Plans
Despite the regulatory challenges, Coinbase maintains a positive outlook on the Indian market. The company’s venture capital arm has continued to invest in local players, most notably increasing its stake in the Indian exchange CoinDCX at a $2.45 billion valuation. This investment signals confidence in the long-term potential of the Indian digital currency ecosystem.
Coinbase is also actively expanding its team in India, with plans to hire across multiple roles supporting both local and global operations. The company currently employs over 500 people in India and intends to bolster these numbers, indicating a long-term commitment to the region.
Building Trust and User Experience
Coinbase is prioritizing building a trusted and user-friendly experience for Indian customers. O’Loghlen emphasized the company’s commitment to security and safeguarding user funds. This focus on trust is intended to differentiate Coinbase from other exchanges and attract a broader user base.
Improving the user interface (UI) is also a key priority. Coinbase aims to create an app experience that rivals the ease and convenience of popular Indian “super apps” like Zepto and Flipkart, allowing users to onboard quickly and seamlessly. This highlights the understanding that a smooth and intuitive experience is crucial for attracting and retaining users in the competitive Indian market.
While many internet companies have successfully scaled in India due to its massive online user base, cryptocurrency platforms have faced significant obstacles. Social media companies and artificial intelligence firms, such as OpenAI, have experienced rapid growth, but the stringent regulations and tax policies surrounding cryptocurrencies have hindered similar progress for blockchain-based businesses.
Looking ahead, the launch of the fiat on-ramp in 2026 is the next critical step for Coinbase in India. The success of this launch will depend heavily on the regulatory environment and the government’s willingness to address the concerns surrounding cryptocurrency taxation. Continued engagement with the FIU and other relevant authorities will be essential, as will monitoring any potential shifts in India’s stance on digital assets. The evolution of India’s regulatory framework will ultimately determine the extent to which Coinbase, and the broader cryptocurrency industry, can thrive in the country.
