Indian Crypto Ecosystem Garnering International Attention Despite RBI Fiasco

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Crypto World At Your Finger Tips!
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Indian Crypto Ecosystem Garnering International
Attention Despite RBI Fiasco
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The Reserve Bank of India (RBI) in April 2018
released a circular prohibiting any banks from
offering their service to crypto exchanges and
any other crypto service providers. The banking
ban had quite a devastating impact on the budding
crypto ecosystem in the country.
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Indian Crypto Exchanges Were Worst Hit by RBI's
Circular

• India has been the IT outsourcing capital of the
  world despite failing to ride on the dot com boom
  in early 2ooos which is a glaring example of
  country's potential in being world leaders in the
  technology field.
• India also saw its first crypto exchange come up
  as early as 2013 in the form of UnoCoin and
  BTCXIndia. In subsequent years, especially after
  the 2017 boom, India saw the launch of 15 new
  crypto exchanges and several other startups.

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• Right, when the Indian crypto community was
  gaining momentum the RBI circular ruined the
  ecosystem completely.
• While the government's concern over the use of
  digital assets for illicit activities is
  understandable, however, RBI's response in the
  form of cutting the only source of liquidation
  for these services was cruel.
• The trading volume on Indian exchanges prior to
  the RBI circular indicates Indian crypto
  ecosystem was thriving prior to the banking ban.

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Binance Eyeing Indian Market

• Binance, the leading cryptocurrency exchange by
  trading volume and an ecosystem known for
  expanding crypto reach is also eyeing India given
  its mammoth population and potential to become
  the crypto hub.
• Binance recently acquired WazirX exchange which
  was a clear indication of Binance's long term
  plan of global expansion and how they view the
  Indian community.
• The global crypto exchange has been eyeing South
  East Asian markets including India and China
  where it sees great potential in terms of user
  growth amid regulatory uncertainty in both the
  countries.

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Exchanges That Went Bust After the RBI Circular

• Many Indian Crypto-Exchanges tasted success in
  its early days and gained traction in 2017, but
  went bust due to the RBI's circular. We will look
  into some of the most prominent exchanges which
  had to either relocate or shut an established
  business.

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1. ZebPay

• One of the most notable Indian exchanges which
  was founded in 2014 and launched in 2015 and
  raised 1.1 million in two seed funding rounds.
  It was among the highest trading volume
  generators among Indian exchanges before it
  decided to shift its operations to Malta. The
  platform also boasts of over 3 million users
  worldwide.
• A recent email from the firm to its Indian
  customers suggested that the exchange is going to
  make a comeback in the coming months.
• ZebPay is estimated to generate around 68.9
  million in annual revenue and a majority of its
  traffic still comes from India.

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2. Koinex

• Koinex, a Maharastra based crypto exchange which
  was founded in 2017 announced its closure due to
  the banking ban in June 2019.
• Koinex has managed to gain popularity in a very
  short period of time and was attracting a lot of
  Indian crypto traders on the platform.
• The exchange was generating an estimated 1
  million in annual revenue before it decided to
  shut down.

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3. UnoCoin

• UnoCoin was established back in 2013 and is among
  the very first crypto trading platforms in India.
  The crypto exchange primarily offered Bitcoin
  through its platform and later added other crypto
  pairs to its trading list and even right before
  the unfortunate banking ban, the platform was
  registering almost 100 BTC worth of daily trading
  volume.
• The platform is not officially shut, however
  following the RBI notice it stopped deposit and
  withdrawals from the platform and is currently
  waiting for the verdict of the supreme court in
  the ongoing lawsuit filed against the RBI.

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• The platform is not officially shut, however
  following the RBI notice it stopped deposit and
  withdrawals from the platform and is currently
  waiting for the verdict of the supreme court in
  the ongoing lawsuit filed against the RBI.
  Cryptoknomics got in touch with Sathvik
  Vishwanath, the co-founder and CEO of the firm to
  get his views on the impact of RBI's circular.
  Vishwanath told,
• "RBI is not a private business to take such
  unilateral decisions. It was to construct a panel
  with industry leaders, experts and policymakers
  to study the policies abroad and their similar
  applicability in our country before coming up
  with such knee jerk reaction."

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4. BTCXIndia

• BTCXIndia was also among the earliest Bitcoin
  exchanges in India which was founded in 2013 and
  was also considered among the most precautionary
  ones as it implemented KYC and AML regulations
  even when there was no necessity for such
  compliance.
• The exchange also offered instant INR deposit and
  withdrawals before the RBI circular came in. The
  exchange had shut its operation back in 2018.
  Cryptoknowmics reached out to BTCXIndia for
  comments, but the founders refused to give their
  input as they haven't been following the ongoing
  Supreme Court hearing and have shifted their
  focus to other sectors.

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5. BuyUCoin

• BuyUcoin is among the first proper cryptocurrency
  exchanges in the country which offered digital
  Asset Exchange and Blockchain Wallet service and
  catered its services to more than 200,000 users
  at its peak.
• The platform also boasted of handling more than
  30m in transactions with digital currencies like
  Bitcoin, Ethereum, Ripple, NEO, Bitcoin Cash,
  Dash.
• The firm had estimated yearly revenue of 1.4
  million at its peak and although it's active
  today, the platform has lost the shine of its
  early days.

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• These are just a few crypto exchanges and service
  providers which were generating millions in
  direct revenue at their peaks before the RBI ban
  kicked in and forced them to either shut their
  business or try to survive without the banking
  facilities.
• These exchanges and their numbers clearly
  indicate that India could have been a major force
  in the fintech industry by now if the central
  bank had taken the right approach.

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WazirX The Indian Exchange Which Survived The
Uncertainty

• WazirX was founded back in 2017 when the Bitcoin
  craze was at its peak, however, the exchange soon
  became the voice of the Indian crypto community
  with its Indiawantscrypto campaign which drew
  attention from all around the globe.
• Apart from running social media and public
  awareness campaign around cryptocurrencies,
  WazirX worked equally hard to ensure that it
  continues to help the Indian crypto community
  trade digital assets with ease and convenience.

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A Hopeful Future

• The stance of the central government towards
  digital assets looked quite passive in the past 2
  years, however, the ongoing supreme court case
  has given a lot of confidence to the Indian
  crypto community.
• The RBI vs Crypto case is one the verge of
  conclusion as both the counsels, RBI and IAMAI
  have concluded their argument in the hearing and
  judgement might arrive in the next 2-3 weeks.
• The Indian National Institute for Smart
  Government (NISG) has published a draft National
  Strategy on Blockchain, which unlike the draft
  bill has recommended regulations as the way to
  move forward.

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• The report makes note of blockchain technologies,
  smart contract applications, challenges to
  blockchain adoption, the societal impact of the
  technology, the role of government, and national
  strategy principles. The report noted that the
  government authorities lacked clarity and
  awareness about blockchain technology.
• "Government of India along with RBI come out with
  a Central Bank Digital INR (CBDR) administered
  over a public permissioned blockchain that
  processes transactions through a Turing complete
  virtual machine allowing decentralised
  applications to run on its platform."
• Sources
• https//www.cryptoknowmics.com/news/indian-crypto-
  ecosystem-garnering-international-attention-despit
  e-rbi-fiasco

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