HYDERABAD: Bitcoin exchanges, traders and buyers are treading cautiously as banks and enforcement agencies see the cryptocurrency in a suspicious light. To bring transparency and create trust about Bitcoins, several leading bitcoin exchanges have formed the Blockchain and Cryptocurrency Committee (BACC) but are still struggling to bring a change in the government’s stance.
A recent announcement by HDFC Bank banning the purchase of Bitcoin using its debit and credit cards, have made stakeholders more prudent.
“Several reputed banks have been forcing Bitcoin exchanges to close accounts, citing reason that the RBI does not allow trading in Bitcoins. This is creating severe problems to us. Not just HDFC, several big banks have been seeing bitcoin in a suspicious light. But we are following all rules and regulations religiously like taking KYC requirements and other documents before selling bitcoins,” said Hesham Rehman, CEO and Co-founder of Bitxoxo.
“We have also been submitting all the information required to ensure transparency. In spite of all self-regulation, it pains to see banks not allowing us to operate freely. Even the volume of bitcoin transactions decreased by about 50 per cent when compared to December.”
Bitcoin exchanges have also come up with a self-regulation draft, observers claim, adding that they are also working to share data and to create a central repository with data of bitcoin buyers and sellers in India. The purpose is to create a positive image about cryptocurrencies.
We maintain the highest level of scrutiny and compliance. Despite the absence of a specific crypto-assets framework from the government, we have adopted high standards from the other sections of the financial sector. For example, when it comes to KYC, we use identical data-collection and verification processes as those used by Banks.
Likewise when it comes to identifying suspicious transactions we use software that is the same that several banks use,” says Ajeet Khurana, CEO of Zebpay. “In addition, we ensure efficient responses to queries from regulators and law-enforcement agencies.”