BHUBANESWAR: Hamstrung for months by the Reserve Bank of India’s order proscribing banks to undertake any cryptocurrency-related transactions, app-enabled bitcoin wallet provider Zebpay on Friday announced its closure.While many exchanges have gotten around the problem with solutions such as peer-to-peer transaction for withdrawal and deposit of fiat money, the drying up of liquidity on its platform has led Zebpay to shut shop.
“Despite regulatory and banking problems along our journey, we continued to look for solutions as we did not want India to miss the bus of digital assets that power the public blockchain. However, the recent past has been extremely difficult. Curbs on bank accounts have crippled us, and our customers’, ability to transact business meaningfully,” Zebpay said in a blog.
Zebpay wallet, however, will continue to work, enabling users to deposit and withdraw coins/tokens into their wallets. The company clarified that all exchange services will be frozen and all unexecuted orders will be cancelled, following which funds will be credited to all customers’ wallets.
Reacting to the shutdown, Nischal Shetty, founder & CEO, WazirX, said, “While Zebpay has been a competitor, it’s unfortunate to see they’re shutting down their exchange. The crypto community needs to stay strong and stick together. We need to keep the crypto fire burning in India.” According to industry estimates as of January 2018, there were 10 cryptocurrency exchanges in India with five million users, bringing in monthly volumes of `10,000 crore ($1.5 billion).
In the wake of the RBI’s ban on banks doing transactions with businesses that deal in cryptocurrencies, the industry awaits Supreme Court’s stance on the future of cryptocurrencies like Bitcoin and Ethereum in India.
Launched in 2015, Zebpay quickly became one of the most-downloaded bitcoin wallet and exchange app, with an annual turnover of `500 crore in less than two years. Shortly after the RBI circular, Zebpay had unsuccessfully mulled moving its head office to cryptocurrency-friendly countries like Singapore or the US.