Bitcoin Trading in India Drops 90 Percent Due to Stricter Bank Clearing RulesMar 20, 2018 at 23:48
India’s Bitcoin (BTC) trading volume suffered a 90 percent decline as regulatory and bank challenges are pressuring cryptocurrency exchanges in the country.
Major banks in the country implemented a two-pronged approach which is affecting trading activity by closing bitcoin exchange accounts and limiting cryptocurrency transactions among locals. Among the banks who enforced stricter rules include the State Bank of India, HDFC Bank, Kotak Mahindra Bank, Citibank and ICCI Bank.
However, it can be noted that the country’s central bank, the Reserve Bank of India (RBI) did not implement the same move.
In an interview, Mohit Kalra, chief executive officer of Dehli-based bitcoin exchange, Coinsecure, said that the stricter rules of the banks resulted to a slump in the trading volume of as low as 30 to 40 BTC from last year’s average daily average of 300 to 400 BTC.
The official noted that the move may be related to the recent crackdown of India’s Income Tax Department of nearly a dozen bitcoin exchanges, searching for customers with a high volume of cryptocurrency trading.
Meanwhile, a representative from India’s blockchain and cryptocurrency industry trade group who requested anonymity said that the local banks’ actions were “overreach” especially since the move was not instructed by government regulators.
“Without any clear mandate either from the RBI or other regulators, asking us to close down our (exchange) accounts while refusing to give in writing what the reason is just disruptive to our business,” the official stated.
In the interim, BTCXIndia and ETHEX India were forced to indefinitely stop their operations pending clarity from government regulations for crypto trading in the country.