The regulatory ‘uncertainty and disruption’ facing India’s cryptocurrency ecosystem have today forced, Koinex, formerly the country’s largest exchange by trading volume to officially suspend its services.
Koinex CEO, Rahul Raj revealed the sad development in an update today, sharing insights regarding the harsh conditions under which the crypto exchange carried out its operations for the past 14 months.
Everything had been going well for Koinex that started its business in the summer of 2017, in the buildup to the crypto market bull run later that year. The exchange reportedly racked up $250 million daily trading volume within its first six months and boarded 40,000 users in a single day at the height of the bull market.
That rapid growth, however, met resistance after the Indian Reserve Bank issued a circular barring all regulated financial institutions in the country to stop providing their facilities to cryptocurrency exchanges as well as any other entities transacting cryptocurrencies.
We even reported that the hostility got to banks which now included a ‘No Crypto’ tag to its Terms and Conditions page for customers.
That restriction, according to Rahul, resulted in Koinex “facing denials in payment services from payment gateways, bank account closures and blocking of transactions for the trading of digital assets.”
Furthermore, the company could no longer freely complete non-crypto related transactions such as refilling its supplies, disbursing employ salary and issuing payment for services provided by third parties.
Rahul also noted that while Koinex has somehow managed to steady the ship, ongoing rumors that India would soon officially ban cryptocurrencies resulted in a sharp decline in trading volumes, as well as, discomfort for the local crypto traders.
Koinex, thus, would cease all trading activities on June 27, while users would have until July 15 to take their funds off the exchange.