Coinbase’s efforts to secure a foothold in India have often been thwarted by regulatory setbacks, and since June, the crypto exchange hasn’t onboarded new users in the country.
In the latest twist, Indian Coinbase users reportedly received an email on Monday, September 11, stating the service would be shut down. But the firm quickly backpedaled, insisting that only certain users are affected.
On Monday, Coinbase said in an email that it would stop providing all trading services to users in India after September 25. It advised users to withdraw funds from their accounts before then.
The news was initially reported by TechCrunch, which shared a statement from Coinbase that insisted, “We are committed to India over the long term and continue to explore ways to strengthen our presence in this important market.”.
However, later on, Cointelegraph reported that the email was only sent to Coinbase account holders who were found to be in breach of the platform’s updated standards. “We will, therefore, be disabling these accounts and allow customers to update their information at a later date,” Coinbase said.
Coinbase first launched in India in April 2022. But less than a week after its debut, the exchange halted payments through United Payments Interface (UPI), a popular Indian payment system.
The decision to suspend UPI payments came when the National Payments Corporation of India (UPCI) stated that it was “not aware of any crypto exchange using UPI.”
During a 2022 annual earnings call, Coinbase CEO Brian Armstrong said, “a few days after launching, we ended up disabling UPI because of some informal pressure from the Reserve Bank of India.”
India’s central bank has long held that private cryptocurrencies are a threat to financial stability and has even pushed to ban the technology.
However, the Financial Stability Board (FSB) and the International Monetary Fund (IMF) recently warned the G20 summit in New Delhi against blanket crypto bans.
Over the weekend, world leaders signed a declaration endorsing many of the FSB’s recommendations.
Discussing the move, Ajay Seth , India’s Secretary of the Department of Economic Affairs, said that the country will finalize its own regulatory position “in the coming months.”
He said the G20 declaration created “the framework for assessing risk,” that will inform “what will be a sound policy for India.”