The chief executive of the exchange said on Tuesday that the service was halted in India because of "informal pressure" from the Reserve Bank of India.
On April 7th, the firm launched its eponymous trading service in India. The app allowed users in the world's second largest internet market to buy cryptocurrencies using UPI, a highly popular Indian payments infrastructure built by a coalition of retail banks. The service was rolled back three days after it was launched.
The National Payments Corporation of India, the governing body that oversees UPI in the country, refused to acknowledge UPI support on the app.
On the company's earnings call, Brian Armstrong said that the company disabled UPI because of pressure from the Reserve Bank of India.
There are elements in the government of India who don't like cryptocurrencies, but it's not illegal to trade in them in India. They're applying soft pressure behind the scenes to try to stop some of the payments.
It would be interesting to find out if the Reserve Bank of India's action is in violation of the Supreme Court ruling. Our preference is to work with them and focus on relaunching. There is a number of path that we have to restart with other payment methods. He said that was the default path going forward.
The Reserve Bank of India had banned cryptocurrencies in the past, but still exerts pressure on banks not to engage with them.
This pressure and the banks' compliance is the reason why popular cryptocurrencies exchanges in India sometimes face issues with supporting the country's currency. An executive at one of the exchanges said that they may challenge the central bank's action in the court, but warned that such a court battle may take years and their businesses may get obliterated in that time.
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Armstrong was added.
I guess just to zoom out for a minute, one of our theories here and my theory is that action produces information. So it’s not always clear as we go to these countries all over the world, everybody is in varying states of kind of education or lack thereof about crypto. And there’s a lot of work to go meet with policymakers around the world and kind of teach them about what the AML capabilities are and what are the positive benefits. The people of these countries generally really want crypto. And so to me, that says that most places in the free world and democracies, crypto is going to eventually be regulated and legal, but it’s going to take time for them to get comfortable with this.
And the way that we push the conversation forward is by taking action. That’s why we’re going to go launch, even if we’re not exactly sure how it’s going to — the reaction is going to be received, we’re going to launch because it forces the discussion to be had. Now the press is talking about it in India. Now there’s meetings happening that are going to talk about how we get to the next step. So that’s generally our approach with international expansion.
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