Top Banks Suspend Accounts of Major Bitcoin Exchanges in India

Large players in the banking sector have suspended a few accounts of the major bitcoin exchanges in India on an intuition of doubtful transactions.

ET noted the banks including the top lenders like State Bank of India, ICICI, Axis bank, HDFC bank and Yes bank. They have suspended few bank accounts of leading Indian cryptocurrency exchanges like Zebpay, CoinSecure, Unocoin and few other.

“Since last month, banks have been asking for additional collateral with 1:1 ratio,” the Economic Times reported. The banks are inspecting current accounts of top Bitcoin platforms in the country, said another person.

No Response from Exchanges and Banks

Although most of the exchanges did not elicit any response, Sathvik Vishwanath, promoter of Unocoin, denied the verdict saying, “The banks have not contacted the company or the promoters regarding the actions you have mentioned.”

Other exchanges include Zebpay, BTCXIndia and Coinsecure did not respond. On the other end, SBI, Axis Bank, YES Bank, ICICI and HDFC banks have not replied to the email asking for more detail.

A Grey Zone for Regulation

The leading cryptocurrency bitcoin is neither illegal nor legal tender in India and largely unregulated.

Surprisingly the entire revenue of the exchanges at the forefront in India could be approximately Rs. 40,000 crore ($6.268 billion) along with operating margins of approximately 20 percent, said the tax officials inspecting the exchanges.

“These exchanges tend to show the total volumes both on buy and sell side as their revenue. In many instances, the exchanges themselves buy and sell cryptocurrencies on their own platform” said an indirect tax official from the team.

It seems a hard time for crypto enthusiast of India. As Arun Jaitley, the finance minister of India, has announced bitcoin and other cryptocurrencies are not legal tender in the country by comparing them to a Ponzi scheme.

The Indian Income Tax Department is keeping a watch on crypto activities in the country and in January 2018 raided crypto exchanges.

Moreover, the Indian taxman has sent an income tax notice to more than ten thousands of individuals involved in cryptocurrency. According to a survey, more than $3.5 billion (approximately Rs. 2,234 Crore) worth of transactions occurred in the past 17 months.

The backers of a few cryptocurrency trading platforms failed to get an appointment with senior government officers since past few months, says a senior officer cooperating with one of the larger exchanges.

According to the local reports, India may regulate bitcoin and other cryptocurrencies with a heavy tax on transactions.

What do you think, India will ever announce the cryptocurrencies as legal tender in the country? Let us know your thoughts in the comments below.