Global cryptocurrency exchange Coinbase has restarted its operations in India after securing approval from the country’s Financial Intelligence Unit (FIU). The move comes just days after the FIU issued a fresh blacklist of 25 offshore exchanges for failing to comply with anti-money laundering (AML) rules.
Coinbase Returns After Regulatory Approval
Coinbase’s return marks the end of a nearly three-year suspension of its services in India. The exchange had exited the market citing regulatory uncertainty and compliance challenges. However, in March 2025, Coinbase officially registered with the FIU under the Prevention of Money Laundering Act (PMLA) 2002, signalling its intent to operate fully within India’s regulatory framework.
Following its approval, Coinbase rolled out an early access programme, enabling users to trade cryptocurrencies and receive market alerts. The company’s re-entry highlights its strategy to regain market trust by working in alignment with India’s tightening compliance requirements.
FIU’s Crackdown on Non-Compliant Platforms
While Coinbase celebrated its relaunch, the FIU intensified its crackdown on unregistered offshore crypto platforms. On 1 October, the authority issued show-cause notices to 25 exchanges accused of offering services in India without FIU registration.
The FIU directed these exchanges to register, implement know-your-customer (KYC) processes, maintain transaction records and report suspicious activities. Non-compliance, the regulator warned, could result in the Ministry of Electronics and Information Technology (MeitY) blocking access to their apps and websites in India.
This marks the second major blacklist since late 2023, when over a dozen global players, including Binance, Coinbase and Bybit, were penalised for operating without registration. Many of these exchanges later paid fines and obtained FIU approval.
Popular Platforms Among the Blacklisted
The latest blacklist includes several well-known global names, such as Paxful, PrimeXBT, BitMex, CoinEx, HitBTC, CEX.IO and Poloniex, alongside smaller platforms serving Indian users.
CEX.IO’s head of financial crime, Mark Taylor, responded to the FIU’s action, stating:
“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.”
The FIU’s directive also compels blacklisted platforms to remove their mobile applications and web portals from public access in India, limiting users’ options to engage with offshore services.
A Regulatory Balancing Act
The FIU’s actions highlight the challenges of regulating India’s rapidly expanding crypto ecosystem. Initially, the lack of clarity over the central regulatory authority left both investors and exchanges in a grey zone. Exchanges often operated without explicit licensing, creating legal risks for themselves and their users.
However, the introduction of AML compliance requirements under PMLA has brought greater oversight. Exchanges now face stringent rules similar to traditional financial institutions, forcing them to improve transparency and reporting standards.
For Coinbase, the decision to comply and re-enter the market reflects the growing importance of India as a crypto hub. With one of the world’s largest populations of digital asset users, India represents a lucrative yet highly regulated environment.
Looking Ahead
Coinbase’s re-entry could signal a wave of compliance-driven operations among global crypto exchanges keen to tap into India’s vast retail market. At the same time, the FIU’s crackdown underscores the government’s determination to prevent illicit financial activities in the sector.
As India tightens its regulatory net, the future of cryptocurrency services in the country appears increasingly tied to strict compliance. Exchanges that fail to adapt risk exclusion, while those willing to align, like Coinbase, stand to benefit from long-term legitimacy and market access.
