Coinbase, the largest US-based crypto exchange, halted its payment services for its Indian users Thursday, April 7, just three days after its launch in the country. The deferred services were due to pressure from the local payment regulators of India, especially the National Payment Corporation of India (NCPI).
In an advertisement on the Coinbase website, the exchange has already told its users that they can place sell orders through the United Payments Interface (UPI). This platform is regulated by the NCPI under the special division of the Reserve Bank of India (RBI).
In a tweet, the NPCI denied these claims by Coinbase and said they did not recognise any crypto exchange on the platform. This was after the release of Coinbase’s new services amidst the launch.
‘With reference to some media reports around the purchase of Cryptocurrencies using UPI, National Payments Corporation of India would like to clarify that we are not aware of any crypto exchange using UPI,’ the tweet said.
Alongside the statement is an attachment of a document that details NPCI’s rebuff on the services provided by Coinbase.
A few days after, Coinbase officially disabled the UPI service in the country after the statement from the NCPI was released.
At the moment, no Indian users can place sell orders through the UPI. When clicked, the link will redirect the users to a page where it urges them to try another payment method.
Coinbase stated to Business Standard Monday after it disabled the services that the exchange would work to remedy the situation.
‘[Coinbase] is committed to working with NPCI and other relevant authorities to ensure that we are aligned with local expectations and industry norms,’ it said.
According to a report by Cointelegraph, Indian traders are likely accustomed to the instability in crypto trading accessibility. There is no suitable regulatory framework for crypto markets which hinders markets to reach crypto users in the country.
UPI is a system that powers multiple bank accounts into a single mobile application of a participating bank. This is a real-time payment system that allows peer-to-peer and retail transactions. It is also regulated by the RBI, the country’s central bank.
At the moment, there are no current bans that are imposed by India against cryptocurrency. Digital assets remain legal in the country both for transacting trades as well as purchasing goods and services.
Moreover, Coinbase is still operational in the country. Indian users are still able to purchase crypto assets through supported networks.
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