Crypto Exchanges Explore New Ways to Execute Trade
Crypto exchanges are aggressively exploring alternative ways to allow investors to buy and sell crypto assets after banks blocked trading and investment in cryptocurrencies following a Reserve Bank of India (RBI) diktat.
In the last few weeks, exchanges have created specialised wallets, on boarded payment processing companies, used banks outside India and even set up ‘offline’ payment systems to let investors access crypto assets.
This comes at a time when several investors liquidated their positions but were unable to get their payouts in the last two weeks. “The cryptocurrency exchanges in India have experienced restricted services from the banks in the recent past and investors across the board are facing issues,” said Shivam Thakral, CEO of cryptocurrency exchange BuyUcoin. “We at BuyUcoin are trying alternative ways to execute payouts for our investors as trust and ethics are an integral part of our work culture.”
Exchanges say most banks have suspended their services and investors are neither able to buy or sell any cryptocurrency using banking channels or platforms.
Cryptocurrency exchanges are also coordinating with each other to make sure that they pay up with a hope of maintaining their trust.
“We have set up online and offline modes of transaction,” said Ashish Mehta, co-founder of DigitX, an exchange. “We have set up banking on ramps with prominent service providers in that area. We are also setting up a strictly verified and validated P2P (peer-to-peer) channel where trust-enabled counter-party risk mitigation will be our top most priority.” Many exchanges are also tying up with payment processing firms — similar to Paytm or Paypal — who in turn deal with the banks. Many investors are running scared after money did not reflect in their bank accounts even when they sold the cryptocurrencies. The exchanges claim it is only in the last two years that they have managed to gain trust of Indian investors, who are flocking to buy a piece of cryptocurrency.
Industry trackers say RBI came out with the diktat despite the Supreme Court quashing the central bank circular banning cryptocurrency in the country, “… It does not make sense for the banks to limit the transactions when the authorities are trying to shift towards regulating this industry,” said Monark Modi, founder and CEO, Bitex, a cryptocurrency exchange.
Exchanges create wallets, use banks outside India, among others to let investors access crypto assets