According to reports, two large Indian cryptocurrency exchanges have stopped deposits via a popular payment method, causing worry in a country where regulatory certainty is still lacking despite Bitcoin’s enormous popularity.
News sources disclosed that Indian crypto exchanges WazirX and CoinSwitch Kuber have disabled rupee deposits using the United Payment Interface (UPI) for the purpose of purchasing cryptocurrencies.
UPI is a widely used real-time payment system in India that is regulated by the central bank. The total value of UPI transactions exceeded $1 trillion in the last fiscal year.
Suggested Reading | Astronaut Launches 1st NFT, Raises $500K To Help Ukraine Fight Russia
In response to anxious users, the two exchanges stated that they can continue to withdraw funds through the interface.
Coinswitch Kuber noted in a tweet:
“UPI deposit is currently disabled for all users, however we are striving to restore it as soon as possible. Please be patient.”
Worries About Financial Stability
India, the world’s second-most populous country, has spent years developing a legislation regulating cryptocurrencies, with a measure endorsed by the central bank because of concerns about financial stability hazards, yet a recent decision to tax cryptocurrency income indicates approval by authorities.
CoinGecko data show the top three Indian crypto exchanges completed approximately $140 million in trades in the last 24 hours.
Thursday’s actions follow a one-line statement last week by the National Payments Corporation of India, the operator of the state-backed UPI system that facilitates bank transfers, in which it stated that it had no knowledge of its use by any cryptocurrency exchange.
BTC total market cap at $785.16 billion on the daily chart | Source: TradingView.com
Indian Crypto Investors On The Rise
In India, digital currency is extremely popular. Indian cryptocurrency investments have exploded in popularity over the last year, growing to a multibillion-dollar market. Around 15 to 20 million people in the country own cryptocurrency.
However, legislative clarity is lacking in the country: India’s central bank earlier suggested banning cryptocurrency, though lawmakers enacted a 30% tax on profits from digital assets in February.
Some sources said trading volume fell precipitously in the aftermath of the new regulation, with volume on WazirX, India’s largest exchange, falling by 71%.
Suggested Reading | Mastercard Files 15 Metaverse And NFT Trademark Applications – A ‘Priceless’ Move?
Investors lamented their frustration on Twitter, since the exchange did not accept the payment gateways of the majority of big banks, including ICICI Bank and HDFC Bank.
“Without providing any information, you have disabled the INR deposit. At the very least, inform us of the duration of the closure,” Avijit Debnath, a Twitter user, urged the exchange via the social media network.
CoinDCX, another large cryptocurrency exchange with over 10 million customers, similarly accepted just bank transfers but demanded a minimum deposit of 3,000.
CoinSwitch, which claims to have over 15 million users, did not react immediately to a Reuters request for comment. Additionally, the NPCI also did not respond.
Featured image from Daily Express, chart from TradingView.com