In what is a sad development for crypto enthusiasts in India, a local cryptocurrency exchange, Koinex disclosed in a Medium post today that it will be shutting down all digital assets operations.
Per the update on Thursday, Koinex had faced 14 months of a hard time in operations, following a de facto ban issued by the Reserve Bank of India (RBI) on banking relationships for crypto firms. Before then, the exchange was India’s largest in terms of daily trading volume.
However, the order from RBI which has now taken its toll on the crypto industry meant that it is economically unfeasible to continue with regular business, Koinex CEO Rahul Raj noted in the update.
He further explained that it required an immense financial burden to sustain their business amid the regulatory pressure.
For instance, the exchange faced a lot of rejection in payment services from payment gateways, as well as bank account closures, and stopping transactions for the trading of cryptocurrency.
“Our team members, service providers, and vendors have had to answer questions from their respective banks — just because of an association with a digital assets exchange operator,” Rahul wrote.
While Koinex managed to sustain the pressure, however, recent developments with crypto and blockchain in India does not favor the company.
The RBI and the government have delayed in clarifying the regulatory framework for the digital assets despite several petitions written in the Supreme Court of India.
Instead, rumors of a proposed bill tagged, “Banning of Cryptocurrencies and Regulation of Official Digital Currencies Bill 2019” caused nervousness among the customers, thereby reducing trading activities on Koinex.
Today, the exchange closed all trading on its platform and also gave users until July 15, 2019, to withdraw their funds.