Two of the country’s major exchanges have stopped accepting deposits through a popular payment method. For a long time, Indian cryptocurrency regulations have been unclear.
According to reports, two major Indian cryptocurrency exchanges have blocked deposits using a popular payment system. This alarming development has been reported in countries that lack regulatory clarity, despite bitcoin being extremely popular.
Reuters reported that Wednesday’s users were unable to use the United Payments Interface (UPI), to purchase cryptocurrency on the CoinSwitch Kuber or WazirX exchanges. UPI, a popular and reliable real-time payment system, is regulated by India’s central bank.
Reuters said users had complained about the lackluster explanations from exchanges for why the halt occurred. However, CoinSwitch stated that UPI acceptance was halted by CoinSwitch due to “regulatory uncertainties”; WazirX claimed that its UPI deposit facility had been disabled in December.
Statement by NPCI as on 7th April 2022. With reference to some recent media reports around the purchase of Cryptocurrencies using UPI, National Payments Corporation of India would like to clarify that we are not aware of any crypto exchange using UPI. Please see attached document pic.twitter.com/lGTcaSLKeC— NPCI (@NPCI_NPCI) April 7, 2022
Last week, the National Payments Corporation of India released a statement stating that it wasn’t aware of any cryptocurrency exchanges using its UPI framework.
Decrypt reached both the exchanges via Twitter and email to request further details, but did not receive a reply by the time this story was published.
India is the second most populous country in the world, and cryptocurrency is very popular there. In the last year, crypto investments have risen to become a multibillion-dollar marketplace. According to to CoinGecko, the country’s three largest exchanges handled more than $139 million in trades within the last 24 hours.
However, there is not much regulatory clarity in India. While India’s central banks had proposed banning cryptocurrency, lawmakers in February approved a 30% income tax on digital assets. According to reports, trading volume dropped dramatically following the new law. WazirX, which is the largest exchange in the country, saw a 72% drop in volume.
Additionally, Indian companies are legally required to declare crypto holdings since the beginning this month.
Shaktikanta Das (the governor of the Reserve Bank of India) stated that private cryptocurrency was a “big threat to our macroeconomic stability as well as financial stability”