WazirX, one of India’s largest cryptocurrency exchanges, is estimated to have eroded 65-90% of its business after e-wallet Mobikwik has disabled services on its platform in the last few days.
ET first reported on 9 April
Because the usage of Unified Payments Interface (UPI) is not clear To process a transaction. US-based Coinbase, which announced its entry into India last week, also ran into a UPI failure and disabled its services.
The transaction volume is the highest Cryptographic exchange (Normalization over the past year) On April 10, data from cryptocurrency aggregator Coingecko.com show that at some point it slid 92-98% compared to the peak observed last year.
The surge in transactions over the past year has been driven by bullish movements in the market, with millions of people participating in the trend of cryptocurrencies in India.
WazirX and ZebPay declined to comment on the impact the business faces.
Discover the story you are interested in
The reduction in trading volume is due to a combination of the latest tax guidelines that came into effect on April 1 and the refusal of payment aggregators and service providers to work with crypto exchanges, according to multiple crypto exchanges. Senior executives say. The broader cyrpto market has also shown a slow start this year and a bearish trend.
The new rule imposes a 30% tax on crypto profits It also does not allow the user to offset the loss.
Vikram Subburaj, founder and CEO of the crypto exchange Giottus, told ET that its service provider blocked UPI access a few days ago.
Cryptocurrency exchange Unocoin also stopped access to UPI this week, but the company attributed it to “technical issues on their part” and will be resolved in a few days.
“Even after the Supreme Court’s decision (which overturned banking banks in 2020) and last year’s RBI clarification (repeated Supreme Court’s decision), the crypto industry is still heavily impacted by the lack of access to Indian banking services. We have received a senior crypto exchange executive requesting anonymity. ” “Services are blocked by payment partners every 2-3 months.”
ET will be based in the United States on April 10th
Coinbase has temporarily suspended UPI payment options After it went under the scanner of UPI Railroad Operator, National Payments Corporation of India (NPCI).
When launched on April 7, Coinbase announced that it would allow users to purchase cryptocurrencies using UPI. This put it under regulatory supervision.
Since these exchanges make a profit on every transaction, a decrease in trading volume has a proportional effect on the company’s profits. Experts said some exchanges could be collapsed in the next six months if the current trend continues.
After the RBI bank banned cryptocurrencies, almost 70-80% of cryptocurrency exchanges shut down and could not survive.
“If things go on, there may be many exchange closures, some will last. The idea is that we need to cut costs and eliminate waste. This will survive in the market. It’s the only way to do this, “said Subburaj of Giottus, who has one million users.