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Coinbase Suspends Certain Indian User Accounts Amid Regulatory Challenges

Published September 21, 2023
9 months ago

Due to increased regulatory scrutiny and stricter tax rules on the cryptocurrency sector in India, Coinbase Global, a prominent US-based cryptocurrency exchange, has announced plans to deactivate numerous Indian accounts on its platform. The accounts, deemed as no longer complying with the company's reinforced standards, will be discontinued as of September 25th.

Coinbase stated that despite these shutdowns, it firmly remains dedicated to the Indian market long-term. The cryptocurrency giant is keenly intent on fortifying its stake in the growing digital space in India, with further plans of resilience in an increasingly challenging regulatory landscape.

Indeed, cryptocurrency trading volumes witnessed a large-scale contraction in India following the enactment of rigorous tax norms by the government. The country imposed a new tax levy on cryptocurrency trading in 2022, an action that ruffled the feathers of many players in the digital currency ecosystem.

In addition, the country’s central bank has been vocal about its severe reservations concerning the propagation of private virtual currencies in India.

Despite these obstacles, Coinbase introduced an ambitious recruitment blueprint for India in April 2020. The company initially attempted to facilitate the use of the Unified Payments Interface (UPI), a nationwide fast-payment network, for digital currency acquisitions via its exchange. Nevertheless, due to mounting regulatory pressures, Coinbase promptly shelved the payments initiative.

Since June 2021, new user registrations on the Indian Coinbase exchange had been put on hold. However, the spokesperson articulated that Coinbase continues to manage a robust technological hub in the country, proactively offering live products, including the popular Coinbase Wallet.

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