The year 2025 is witnessing winds of change in the cryptocurrency industry, not just for economies in the U.S., Canada and Europe but also in emerging Asian economies like India where the government is fiddling with the idea of a more relaxed regulatory framework for the sector.
Of late, the Financial Intelligence Unit (FIU)-India, the nodal agency to authorize foreign crypto exchanges and businesses, gave permit to Binance, Bybit and Coinbase, leading to the re-return of the three largest crypto exchanges in India. The three exchanges had unceremonious exit from India between 2022-2024 over regulatory concerns with the government.
While global players like Binance, Bybit and Coinbase are all set to capture the emerging yet niche market of Indian crypto investors again, a local crypto exchange- WazirX- is now prepping to re-launch itself, more than eight months after it was struck by a massive Rs 2000 crore hack, which then led to the exchange management suspending all operations.
WazirX exchange is still reeling under the after effects of July 2024 cyber hack, its ownership is currently under dispute between its founder Nischal Shetty and Binance and the remaining user funds are now heading towards a structuring scheme with Singapore Court.
So, where are we right now? WazirX management has promised to compensate its users up to 85% of their portfolio, as it was on July 18, 2024 (the day of cyber hack) in April-May 2025, almost a year after trading was suspended on the platform. The remaining 15% funds will be returned to users in the span of next 2-3 years with the revenue WazirX earns by re-launching itself and also by launching a new decentralized exchange (DEX) in India.
To get their grand scheme of things approved by the Singapore court, WazirX needs majority support of its 4.4 million users and for that, it is conducting online voting from March 20, which will be continued for the next one week. The management under Nischal Shetty is confident to pull this off and compensate their users with 100% of their funds.
But as reported by The Crypto Times, the recovery plan proposed by WazirX to compensate its users have a lot of “ifs and buts”, and would really depend on whether Indian users are willing to trust the exchange management, especially after it has come under fierce criticism for lack of transparency and accountability.
There was a time when WazirX was the largest cryptocurrency exchange in India with over a billion dollars in-flow and over 16 million registered users. Cut to 2025, the exchange is still battling hack infused crisis and its co-founders are currently under criminal investigation.
And now with the re-entry of Binance, Bybit and Coinbase in India, does WazirX really stand a chance to resurrect itself again and also meanwhile launch a DEX simultaneously for Indian users? In this article, we will dissect the lofty claims made by WazirX and the impact of the three major global exchanges entering Indian markets.
Coinbase, Bybit and Binance say Namaste India !
Recently, Coinbase secured approval from FIU to provide retail services and other investment products to Indian investors and traders.
India is one of the most exciting markets today, and we are proud to deepen our investment here while staying fully compliant with local regulation”, said John O’Loghlen, the Asia Pacific Managing Director of Coinbase.
However, Coinbase is not the only one returning to Indian markets. Recently, Binance and Bybit have also done the same. Binance resumed all operations in India last year by registering with the FIU India. On the other hand, Bybit paid ₹9.3 crore in penalties and was registered with FIU IND, confirming its return ticket to Indian markets.
All these foreign exchange re-entries in India come at a very crucial moment. U.S. President Donald Trump has vowed to make America the crypto capital of the world. And Trump is not alone as even much smaller economies like El Salvador, Kenya and Bhutan are also in the race to acquire Bitcoins as government treasury.
Now, with the Indian government mulling a policy change for crypto, the most populous nation is also part of the race for crypto adoption. The return of foreign exchanges has greater implications and impact on the Indian crypto ecosystem as they can fill the void left by desi exchanges like BITBNS and WazirX.
Why Foreign Exchanges Left Indian Markets?
The main troubles began brewing in late 2023 when India’s Financial Intelligence Unit (FIU) dropped a bombshell by issuing show-cause notices to nine major crypto exchanges, including industry leaders like Binance and Kraken, for non-compliance with money laundering prevention rules.
The full list includes Binance, Bittrex, Bitstamp, Kraken, Bitfinex, MEXC Global, Huobi, Gate.io, and KuCoin. Not only this exchanges like Binance and KuCoin fined over ₹18 crore and ₹34 Lakhs respectively. This raised fears of a regulatory crackdown among the international crypto businesses and as a result, many big crypto exchanges shut down their operations in Indian markets.
Potential Benefits of International Exchange Entry
The arrival of established global exchanges will restore the users’ confidence which was shattered by past setbacks. These platforms bring established security practices and international credibility, potentially restoring faith in crypto trading after the WazirX incident.
Moreover, these international exchanges will bring massive investment into the Indian crypto sector. Coinbase has specifically mentioned expanding its crypto developer platform in India.
Where does WazirX stand now?
Once a leading Indian exchange, WazirX lost approximately half of its reserves in a major security breach last year. The 2000 crore hack shook the foundations of the exchange, paralyzing it for the next one year as lakhs of Indian users had their funds stranded.
The exchange management has also come under fierce criticism for the mismanagement, lack of transparency in its dealings and zero accountability from its founder Nischal Shetty. The fact that Shetty tried to shift ownership responsibility to Binance and also withdrew Rs 100 crores from remaining user funds for their own legal and administrative fees, has also not gone down well with users.
The WazirX management has made some boisterous claims about relaunching their exchange even after compensating its 4.4 millions users with 85% of their portfolio amount. The exchange has also claimed to launch India’s largest DEX in 2025. The management has promised to share revenues from the two projects (if made any) with their users to compensate them for the remaining 15%.
However, millions of WazirX users have missed out on the November 2024 Bullrun as their funds were locked in the exchange. Logic says, they would at the first availability of their portfolio, would like to withdraw their funds from the exchange. The assumption that Indian users will once again trust WazirX with their money is far fetched.
Final Thoughts
The return of major international exchanges like Coinbase, Binance, and ByBit is signifying a major shift in the Indian crypto ecosystem. The entry of these exchanges will restore the trust of users who have suffered previously from the WazirX hack and have developed trust issues with Indian crypto exchanges. Whether the air castles of WazirX will see the light of day will depend on the trust Indian users have for this exchange.
Also Read: Unlock GrokAI’s Replies on The Crypto Times’ Questions on WazirX
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