Cryptocurrency Exchange Reopens in India After Two-Year Suspension

Source: CryptoNewsNet Original Title: Coinbase has reopened its app for registrations in India after more than two years Original Link: A major cryptocurrency exchange has announced the reopening of its app for registration in India, marking its return to the country after more than two years of suspension.

Return to Compliance

This reentry follows the company’s registration this year with the Financial Intelligence Unit, India (FIU), thereby ensuring compliance with the country’s anti-money laundering (AML) regulations. The director for the exchange’s Asia-Pacific region hinted at the firm’s plans to launch a fiat on-ramp next year during India Blockchain Week (IBW). He explained that the exchange had adopted the idea of introducing a fiat on-ramp to enable users based in India to deposit their funds and purchase cryptocurrency effectively.

Previous Market Exit

The exchange had introduced its services in India back in 2022. After careful consideration, it had to swiftly suspend its efforts to support the Unified Payments Interface (UPI) payment system. This decision came after the UPI operator refused to recognize the exchange’s operations in India.

Following this denial, the exchange was left with no other choice but to stop all its activities in the country in 2023. The company then instructed its users based in India to close their accounts.

“We previously had millions of customers in India, and we decided to completely remove those customers from overseas entities where they were based and regulated. We wanted a fresh start here,” the director explained.

After ceasing all operations in India, the company partnered with the Financial Intelligence Unit, a national government agency responsible for collecting, analyzing, and disseminating information on suspicious financial activities. The exchange successfully registered with the agency this year, initially granting users access to the app in October. Now, the exchange has made it available to everyone.

Market Growth Trends

The reopening marks a growing trend among several internet firms developing new markets in India. Several analysts noted that these companies aim to reach the second-largest group of online users worldwide. However, while AI companies and social media platforms are experiencing rapid growth in this market, cryptocurrency firms are encountering significant challenges due to strict regulations and tax hikes on digital currencies.

Tax Concerns

In India, crypto earnings are subject to a 30% tax, inclusive of any losses encountered. The country also imposes a 1% tax on every transaction. Analysts cautioned that such factors may deter individuals from engaging in frequent trading.

The exchange expressed optimism that the government will soon reduce these tax burdens, making it easier for individuals to own digital assets. Despite these obstacles, the firm stated it has a bullish outlook for its expectations in India.

The company also mentioned that its investment branch has invested additional funds into a leading crypto trading app in the country, now valued at $2.45 billion following its funding round. To demonstrate its commitment, the exchange publicly highlighted its intention to grow its workforce, which comprises more than 500 workers in India, by hiring for various positions targeted at both local and international markets.

“I think we want to be recognized as a trusted exchange that keeps your money safe,” the director stated. “We can’t reach a wide audience if we don’t provide an easy-to-use interface and a reliable experience that lets you sign up within minutes.”