Indian crypto exchanges begin shutdown of fiat services
Cryptocurrency exchanges in India have begun to shut down their fiat currency deposit and withdrawal facilities as the country’s banks start closing the accounts of exchange clients under the instructions of the central bank.
The Reserve Bank of India issued demands back in April banning all financial institutions from offering banking services to crypto exchanges. The ruling came into force on Thursday, 5 July.
Petition against ban
The IAMAI represents most of India’s digital currency exchanges and asked for the hearing, originally scheduled for 20 July, to be brought forward. While the court allowed the IAMAI’s petition to be heard ahead of the RBI ban, it still ruled in favour of the RBI and said the IAMAI’s petition, along with four others would still be heard in the court on 20 July.
Among India’s largest exchanges, Zebpay was also among the first to notify its clients.
It announced on its platform: “Today we are disabling the rupee deposit and withdrawal options on the Zebpay app. This is being done in light of the bank account closures as per the RBI guideline.”
It added: “Rupee deposits and withdrawals have been paused in the Zebpay app until banks allow us again.”
The country’s biggest exchange Unocoin expressed its disappointment that the Supreme Court had refused a stay on the ban ahead of the official hearing on 20 July.
It also sought to add clarity to those investors who may have misunderstood the RBI’s intentions as a blanket ban on crypto exchanges.
It said: “Banking services are expected to be revoked this week. We would like to let you know that this is not a ban on cryptoasset.
“However, if you are withdrawing or depositing any rupees in Unocoin, there could be a time when we may not honour such requests. Please continue to trade once you have understood the risk.”