Coinbase has suspended trading services in India due to “unofficial pressure” from the central bank of India, the cryptocurrency exchange’s CEO said Tuesday, covering a notable Indian episode after a month.
The Nasdaq-listed company launched its eponymous cryptocurrency trading service in India on April 7th, drawing a lot of attention. The app allows users in the world’s second largest internet marketplace to purchase crypto tokens using UPI, a popular Indian payment infrastructure built by the Retail Federation. Bank. However, three days after launch, the service was rolled back without explanation.
The move follows a strange statement from India’s National Payments Corporation, the governing body that oversees UPI in India, stating that the Coinbase app does not recognize UPI support.
Coinbase co-founder and CEO Brian Armstrong said during a company earnings announcement that Coinbase had disabled UPI “due to unofficial pressure from the Central Bank of India” when asked about the Indian episode.
Armstrong pointed out that cryptocurrency trading is not illegal in India. In fact, South Asian countries have recently started to impose taxes. positive about it. So they called it ‘shadow ban’ in the press. Basically, we are putting soft pressure behind the scenes to disable some of these payments that can cross the UPI,” he said.
The Central Bank of India’s action “may actually be in violation of the Supreme Court ruling. But I think our preference is to really work with them and focus on relaunch. I believe there are multiple paths that require you to start over with a different payment method. And that’s the basic path forward,” he said.
The central bank of India has previously banned cryptocurrencies, a decision that was overturned by the highest court of India two years ago.
These pressures and banks’ compliance are the reasons why India’s popular cryptocurrency exchanges regularly face issues with Indian fiat support. An executive at one of the cryptocurrency exchanges told TechCrunch that they too could contest the central bank’s action in court, but such a court battle could take years and their business could disappear in that time. India expects its central bank to ease its stance in the near future.
Let’s zoom out for a moment. One of our theories here and mine is that behavior produces information. So it’s not always clear when we go to these countries around the world. Everyone is in a variety of educational backgrounds or lacks cryptocurrencies. And I have a lot to do with meeting policy makers around the world to teach them what AML does and what its positive benefits are. People in these countries generally want cryptocurrencies. So to me, cryptocurrencies will eventually become regulated and legalized in most parts of the free world and democracies, but it will take some time to get used to.
And the way we move the conversation forward is by taking action. That’s why we want to launch. Even though we’re not sure exactly how it will turn out — we’ll release it because a response will be accepted, and it should be discussed. Now the press is talking about it in India. Now we have a meeting going on where we will discuss how to move to the next level. This is generally our approach to international expansion.