With the latest policies of the Indian government toward cryptocurrencies, the local exchange markets are in hot waters. Recently, several Indian cryptocurrency exchanges decided to switch to the peer-to-peer consensus model. The exchange markets are making the P2P shift to create an alternative for continuing digital transactions.
Recently, new taxonomy laws for crypto traders saw a massive number of banks and digital payment platforms parting ways with the Indian crypto exchanges. Under these circumstances, crypto platforms like WazirX, CoinDCX, and others were unable to provide withdrawal options to their consumers in India.
With the recent changes, the cryptocurrency exchanges are directly connecting the sellers and buyers when a new order is generated. In this manner, cryptocurrency traders can keep selling and purchasing cryptocurrencies through the P2P model. The buyers can use their banking channel to transfer the payments to the seller accounts or cryptocurrency wallets.
With this new option, the cryptocurrency organizations and banking enterprises have no direct term of service or interconnection. Recently, the local Indian media outlets reported the response from the cryptocurrency markets in the region about the latest development. One executive told the media while remaining anonymous that the current P2P is not very efficient, but it is the only way for the crypto markets in India to keep operating in the country without violating the laws.
Reserve Bank of India has Adopted Severe Stance Towards Cryptocurrencies
Reserve Bank of India has imposed severe financial sanctions on the crypto markets and local businesses to refrain from integrating or promoting crypto-related payments in the country. Coinbase opened its office in India last year and immediately moved to revoke its partnership with a local digital payment service provider due to the legal notice issued by the Central Bank or RBI.
CoinSwitch Kuber is another cryptocurrency exchange in India that had to suspend its deposits and withdrawal options due to the bailout of the Unified Payments Interface or UPI.
Some cryptocurrency markets in India have resorted to enabling direct payments in their bank accounts for their clients. After the payment confirmation, the exchanges update the digital wallet of the users to allow them to purchase cryptocurrencies.
A legal expert claimed recently that such methods postulate that these crypto exchanges are offering wallet facilities to consumers that can also come under regulatory scrutiny. Meanwhile, investors and crypto organizations have started to move their crypto reserves to international wallets already.