Global cryptocurrency exchange Coinbase has restarted services in India, nearly three years after suspending its operations due to regulatory uncertainty. The move follows the exchange’s successful registration with India’s Financial Intelligence Unit (FIU) earlier this year, marking a significant milestone in the country’s evolving digital asset landscape.

In March, Coinbase complied with India’s anti-money laundering (AML) framework under the Prevention of Money Laundering Act (PMLA) 2002. This included registering with the FIU, paying penalties for earlier operations without approval and implementing stricter compliance measures. Early reports suggest that Indian users now have access to retail trading features, along with notifications and alerts rolled out under an “early access” programme.

The restart positions Coinbase among a select few global players that have chosen to align with Indian regulations, in stark contrast to others that continue to operate without approval.

FIU Expands List of Blacklisted Exchanges

Coinbase’s return comes at a time when India’s regulatory stance on digital assets is hardening. On 1 October, the FIU released a new list of 25 blacklisted offshore cryptocurrency exchanges for failing to comply with AML obligations. This is the second such list since late 2023, when nearly 12 major foreign platforms, including Binance and Coinbase, were restricted from serving Indian users.

The FIU has issued show-cause notices to these 25 entities, demanding immediate compliance with requirements such as:

• Registration with the FIU
  
• Full Know Your Customer (KYC) implementation
  
• Record-keeping of transactions
  
• Reporting of suspicious activities
  

Failure to comply could lead to action by the Ministry of Electronics and Information Technology (MeitY), which has the authority to block apps and websites of these platforms across India.

Global Names Under Scrutiny

The new blacklist includes several globally recognised platforms, such as Paxful, PrimeXBT, BitMex, CoinEx, HitBTC, CEX.IO and Poloniex. Many of these exchanges continue to cater to Indian traders without official registration, making them vulnerable to enforcement measures.

Commenting on the development, Mark Taylor, Head of Financial Crime at CEX.IO, told TechCrunch:

“We are actively exploring pathways to ensure alignment with India’s regulatory requirements and any required registration with Indian authorities to ensure long-term accessibility for our users in the region.”

This reflects a growing awareness among international crypto firms that regulatory compliance in India is no longer optional but a prerequisite for sustainable operations.

Regulatory Clarity Still a Challenge

While Indian authorities have made compliance mandatory, the broader regulatory framework remains complex. Many exchanges argue that the lack of initial clarity about the central regulatory authority made it difficult to comply in the early stages. The FIU has now emerged as the primary enforcement body, creating a clearer though more strict pathway for foreign platforms seeking entry.

For Coinbase, aligning with the FIU may give it a long-term competitive advantage in India, one of the fastest-growing crypto markets globally. Meanwhile, non-compliant platforms face app store removals, website blocks and potential loss of user trust.

Outlook

Coinbase’s comeback signals a new chapter in India’s crypto market, where global exchanges are compelled to choose between compliance and exclusion. With the FIU ramping up enforcement through successive blacklists, the message is clear: unregulated operations will no longer be tolerated.

For Indian traders, the shift may ultimately bring greater transparency and security, though access to some international platforms could shrink in the short term. As the digital asset ecosystem continues to evolve, exchanges that proactively embrace regulation are likely to cement their place in India’s vast and increasingly regulated market.