Coinbase has disabled the sign-up of new users on its exchange product in India for quite some time, the major cryptocurrency exchange elaborated this week.
Initial reports suggested that Coinbase would cease operations in India altogether, creating confusion among users. However, Coinbase has clarified that this is not the case. The discontinuation of services is not a blanket action but rather targets specific accounts that do not meet Coinbase’s updated standards.
Coinbase further elaborated that during a routine review of its systems, it identified accounts that were not in compliance with its new standards. As a result, these accounts will be disabled. Coinbase maintains that affected users will have the opportunity to update their information at a later date. The users started receiving emails on Sunday, September 11.
“We stopped allowing new user sign-ups on our exchange product in India back in June of this year. We maintain a robust tech hub in the country and offer live products, including our Coinbase Wallet. We are committed to India over the long term and continue to explore ways to strengthen our presence in this important market,” a spokesperson for Coinbase said in an official statement.
“It is possible that during the course of a recent routine review of our systems, some accounts may have been identified that no longer meet our updated standards. We will therefore be disabling these accounts, and allow customers to update their information at a later date,” the spokesperson said, adding that Coinbase will continue to “raise the bar” by first disabling legacy accounts. The “updated standards” have not been shared.
Coinbase’s journey in India has been marked by regulatory challenges. When it initially launched in India in April 2022, it offered the option to buy cryptocurrencies using the Unified Payments Interface (UPI), a popular local payment method. However, shortly after the launch, it had to suspend UPI support due to regulatory pressures, and over the past year, has failed to make major inroads in the world’s second-largest internet market.
And speaking of India, the country’s stance on cryptocurrencies has been somewhat ambiguous. While the Supreme Court of India ruled that the government could not ban cryptocurrencies, regulators, including the Reserve Bank of India (RBI), have expressed reservations. The RBI has reportedly applied what Coinbase’s CEO, Brian Armstrong, referred to as “soft pressure” to discourage cryptocurrency transactions via UPI.
Now that new sign-ups are disabled for Indian users, those who have received the notice will have until September 25, 2023, to withdraw the entirety of their funds. And if this is not enough, the major crypto exchange has also banned Indian users from registering on the exchange, advising them to download Coinbase Wallet instead. Indian users can now send existing cryptos from their accounts to other crypto wallets.