Not long ago, what could be one of the largest cryptocurrency exchanges in India, Zebpay, is sad to announce that it is shutting down its exchange due to the crypto banking ban imposed by the Reserve Bank of India (RBI). The exchange wrote, “At this point, we are unable to find a reasonable way to conduct the cryptocurrency exchange business.”
This past Friday, Zebay announced that the shutdown of its popular crypto exchange, which according to its website has over three million users. “Despite regulatory and banking problems along our journey, we continue to look for solutions as we did not want India to miss the bus of digital assets that power the public blockchain,” the exchange noted.
Nonetheless, Zebpay admitted “he curd on bank accounts has crippled our, and our customer’s ability to transact business meaningfully. At this point, we are unable to find a reasonable way to conduct the cryptocurrency exchanges business. As a result, we are stopping our exchange activities.” The exchange recently canceled all unexecuted crypto-to-crypto order on September 28th at 4 pm (Indian time). Clients’’ cryptocurrencies will be credited to their Zebpay wallets. The exchange made clear “No new orders will be accepted until further notice,” but also wrote “Zebpay wallets will continue to work even after the exchange stops. You are free to deposit and withdraw coins/tokens into your wallet.”
Back on April 6, when the Reserve Bank of India (RBI) issued circular banning banks and financial institutions under its control from providing services to crypto businesses. The ban went into effect in July. A little while after the RBI issued its circular, Zebpay launched its crypto-to-crypto trading platform. In August, the exchange added trueusd trading. However, the banking problem has been hurting Zebpay’s business.
Early this month (September 4th), the exchanged announced that it will return all users’ Indian rupees on deposit at the exchange. “We have been distressed at the raw deal crypto-traders are getting in India as a result of the banking problems,” as stated by Zebpay. Not long ago, Sathvik Vishwanath, the CEO of Unocoin, another major Indian exchange stated: “India’s biggest crypto population is not ready for the crypto-to-crypto trading.”
At the same time, a number of smaller exchanges have launched exchange-escrowed peer-to-peer (P2P) trading which they claim to have rapidly gained popularity since the RBI ban. Even the central bank has noticed the growth of P2P trading. In its annual report, the RBI wrote that “some trading may shift from exchanges to peer-to-peer mode, which may also involve increased use of cash.”