Zebpay Exchange Halts Fiat Ops As India Crypto Banking Ban Deadline Looms

Just days before a controversial bank ban on cryptocurrency businesses goes into effect, one of India’s largest exchanges, Zebpay, announced Wednesday it was freezing Indian rupee deposits and withdrawals, CoinTelegraph reported.

After earlier warning users rupee deposits and withdrawals “could” stop if the ruling from the Reserve Bank of India (RBI) went ahead, Zebpay said current events were “beyond its control,” the report said.

In an update to that original warning, Zebpay said: “INR deposits and withdrawals have been paused in the Zebpay app until banks allow us again,” CoinTelegraph said.

On Tuesday, India’s Supreme Court upheld the ban deadline, the report said, declining to grant an extended grace period to cryptocurrency businesses which rely on banking connections to serve customers.

The decision means Thursday’s deadline still holds, the report said, while the Supreme Court confirmed it will hear a petition against the ban July 20.

Since the initial issuance on April 6, CoinTelegraph said, some businesses have sought alternative means of providing fiat support. Fellow exchange WazirX said it would transform into a P2P platform so no in-house conversion between crypto and fiat would be necessary.

“If banking is something the exchanges are not allowed to do, then the solution is something that direct banking doesn’t come in,” CEO Nischal Shetty told local news outlet Economic Times.

Earlier, Zebpay was confident in the face of the ongoing uncertainty surrounding cryptocurrency in India, the report said.

In a February interview with Cointelegraph, co-founder Sandeep Goenka said he “welcomed” government proposals to crack down on illegal activity, calling for a joint effort to stabilize the local economy.

“We encourage the government to work with our members, as we are committed to detect, report, and eliminate suspicious transactions in pretty much the same way as other institutions do,” he said.

– WN.com, Jack Durschlag