Coinbase has initiated direct deposits and withdrawals of Indian Rupees (INR) for its customers in India, marking a significant step in simplifying the transaction process between bank accounts and the cryptocurrency exchange. This new feature allows users to bypass intermediaries, although its rollout will be gradual. Several users have reported encountering a “Buys not supported” message after completing the onboarding process, with the company indicating that access will continue to expand over time.
This move represents Coinbase’s second attempt to establish a foothold in the Indian market, following a brief entry in 2022. During its initial launch in India, the exchange was equipped with Unified Payments Interface (UPI) support but had to suspend it within a mere three days. This decision came after a statement from the National Payments Corporation of India raised concerns about the platform’s compliance with local regulations, which Chief Executive Brian Armstrong later attributed to informal pressure from the Reserve Bank of India. Consequently, Coinbase’s operations were limited to crypto-to-crypto transactions.
After reopening sign-ups last year without a fiat support system, Coinbase has now opted to process INR deposits through the Immediate Payment Service (IMPS), a well-established interbank transfer system in India. This strategy effectively avoids the complications associated with UPI while still operating within the framework established by the National Payments Corporation of India. Furthermore, Coinbase is registered with India’s Financial Intelligence Unit (FIU-IND), assuring compliance with local regulatory standards.
However, users have reported challenges even after onboarding, with some encountering restrictions on buying crypto. Akshay Chugh, Coinbase India’s product lead, characterized these limitations as part of a phased rollout rather than a nationwide restriction.
The new features also involve the introduction of spot trading and perpetual futures, which are supported by a local INR order book. This will enable Indian traders to engage with domestic liquidity, contrasting with the global pricing typically available on the platform. While Coinbase has stated that there will be no fees associated with INR deposits, trading costs are designed to align with those of local competitors. The ability to utilize direct bank rails is expected to reduce the premiums commonly associated with the peer-to-peer trading routes many Indian users have relied on.
Looking forward, forecasts suggest that India’s cryptocurrency market could approach $14 billion by 2034, buoyed by strong local demand despite significant trading costs. However, the market is currently operating within a restrictive taxation framework, which includes a flat 30% tax on gains and an additional 1% tax deducted at source. These taxes were retained in India’s 2026 budget, contributing to a trend where a substantial volume of trading has shifted offshore, with many Indian traders now opting for foreign platforms.
As Coinbase navigates these complexities, its latest initiative highlights both the potential for growth in the Indian crypto market and the significant regulatory and economic hurdles that remain.
