Coinbase halted trading service in India because of “informal pressure” from the Reserve Bank of India, the crypto exchange’s chief executive said on Tuesday, addressing the notable Indian episode for the first time in a month.
The Nasdaq-listed firm launched its eponymous crypto trading service in India to much fanfare on April 7. The app allowed users in the world’s second largest internet market to buy crypto tokens using UPI, a highly popular Indian payments infrastructure built by a coalition of retail banks. But just three days after the launch, the firm rolled back the service without an explanation.
The move followed a strange statement made by the National Payments Corporation of India, the governing body that oversees UPI in the country, in which it refused to acknowledge UPI support on Coinbase’s app.
Asked about the Indian episode on the company’s earnings call, Coinbase co-founder and chief executive Brian Armstrong said Coinbase disabled UPI “because of some informal pressure from the Reserve Bank of India.”
Armstrong pointed out that cryptocurrency trading is not illegal in India — in fact, the South Asian nation just recently started to tax it — but there are “elements in the government there, including at Reserve Bank of India, who don’t seem to be as positive on it. And so they — in the press, it’s been called a ‘shadow ban,’ basically, they’re applying soft pressure behind the scenes to try to disable some of these payments, which might be going through UPI,” he said.
The Reserve Bank of India’s action “may be actually in violation of the Supreme Court ruling, which would be interesting to find out if it were to go there. But I think our preference is really just to work with them and focus on relaunching. I think there’s a number of path that we have to relaunch with other payment methods there. And that’s the default path going forward,” he said.
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