Coinbase Eyes India Comeback After 2023 Exit: Can It Overcome Regulatory Hurdles?

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Coinbase, one of the world’s largest cryptocurrency exchanges, is reportedly planning a return to the Indian market after abruptly halting operations in 2023. The move signals a renewed push by the exchange to tap into India’s rapidly growing crypto ecosystem, despite ongoing regulatory uncertainty.

With India emerging as a key player in global Web3 innovation, Coinbase’s comeback could bring new opportunities for traders, developers, and institutional investors—if it can successfully navigate the country’s complex regulatory environment.

Why Coinbase Left India in 2023

Coinbase launched in India in 2022 with much anticipation but faced several operational challenges, leading to its exit in 2023. Key factors behind its departure included:

• Regulatory Uncertainty – India’s crypto landscape remains in flux, with no clear legal framework governing exchanges.
• Payment System Restrictions – The National Payments Corporation of India (NPCI) restricted Unified Payments Interface (UPI) access for crypto exchanges, limiting on-ramp options.
• Tax & Compliance Issues – India introduced a 30% tax on crypto gains and a 1% TDS (tax deducted at source) on transactions, making it costly for traders and exchanges.

These obstacles forced several foreign exchanges, including Coinbase, to scale back or exit the Indian market entirely.

Coinbase’s India Comeback: What’s Changing?

Despite past challenges, Coinbase is re-evaluating its strategy for India, likely influenced by:

1. India’s Growing Crypto Adoption – With millions of users and a booming developer community, India remains a lucrative market for exchanges.
2. Government Interest in Blockchain – While skeptical of crypto trading, India has embraced blockchain innovations, signaling potential long-term regulatory shifts.
3. Regulatory Pressure on Offshore Exchanges – India has cracked down on non-compliant exchanges, making Coinbase’s regulated presence a strategic advantage.

If Coinbase can work around India’s payment restrictions and comply with local tax laws, it could carve out a sustainable foothold in the world’s most populous country.

Challenges Coinbase Still Faces in India

Despite its renewed efforts, Coinbase must overcome several regulatory and operational hurdles before successfully re-establishing itself in India:

• Crypto Taxation – India’s 1% TDS on crypto transactions continues to reduce market liquidity, making high-frequency trading difficult.
• Regulatory Uncertainty – The lack of clear crypto laws means exchanges operate in a legal gray area, increasing compliance risks.
• Competition from Domestic Players – Indian exchanges like WazirX, CoinDCX, and ZebPay dominate the market, with strong local user bases.

To thrive, Coinbase will need strategic partnerships, regulatory clarity, and a tailored approach that aligns with India’s evolving crypto landscape.

The Role of Tokenized Gold & RWA in India’s Digital Economy

As crypto trading faces hurdles in India, the country has shown interest in blockchain-based real-world assets (RWAs) like tokenized gold.

Tokenized gold, which represents fractional ownership of physical gold, is gaining traction due to:

• India’s Cultural Preference for Gold – Gold is deeply embedded in Indian investment culture, making tokenized gold a natural fit for digital adoption.
• Stable Alternative to Crypto Volatility – Unlike speculative tokens, gold-backed assets provide inflation resistance and price stability.
• Regulatory Acceptance – Tokenized RWAs align with India’s push for regulated blockchain use cases, offering a compliant pathway for digital assets.

If Coinbase expands beyond crypto trading to offer RWA tokenization, including tokenized gold, it could position itself as a key player in India’s blockchain revolution.

What’s Next for Coinbase in India?

If Coinbase re-enters the Indian market, it will likely:

1. Explore New Payment Integration Options – Finding alternatives to UPI to enable fiat-to-crypto transactions.
2. Strengthen Compliance with Tax & Regulatory Requirements – Ensuring full transparency in line with India’s evolving crypto policies.
3. Offer Institutional & Web3-Focused Services – Shifting focus beyond retail trading to DeFi, staking, and RWA tokenization.

If Coinbase executes a compliant, localized strategy, it could cement its place in one of the world’s largest crypto markets.

Final Thoughts

Coinbase’s potential return to India highlights both the country’s massive crypto potential and its regulatory challenges. If successful, Coinbase could reshape India’s digital asset landscape, bringing more legitimacy, security, and institutional adoption to the market.

However, without regulatory clarity or a solution for India’s crypto tax hurdles, Coinbase risks facing the same issues that led to its 2023 exit.

As India continues exploring blockchain innovations, tokenized RWAs, including gold-backed assets, could emerge as a regulatory-friendly alternative, offering Coinbase and other exchanges new opportunities in the region.

_{This article reflects the opinions of the publisher based on available information at the time of writing. It is not intended to provide financial advice, and it does not necessarily represent the views of the news site or its affiliates. Readers are encouraged to conduct further research or consult with a financial advisor before making any investment decisions.}