Indian Crypto Exchange Coinome Buckles Under Regulatory Pressure

Coinome, an Indian cryptocurrency exchange announces that it will be halting operations as of May 15, becoming yet another prey to the regulatory difficulties in the country. The exchange announced the development in an official tweet from the exchange on May 9.

Indian exchanges have been facing a moratorium on banking services since the central bank, the Reserve Bank of India (RBI), exercised a ban on dealings with crypto businesses last year. With a local media alleging in late April that various government divisions are planning on an absolute ban on crypto in all its forms, things might get worse if the rumors are true.

Backed by prominent Indian online payments gateway Billdesk, Coinome, hasn’t yet clarified whether the suspension is in effect a total shuttering of services, the tweet only states:

All crypto markets on Coinome will be suspended, effective 2pm on May 15th, 2019. Customers are requested to withdraw all their crypto assets from Coinome at the earliest.

— Coinome (@CoinomeOfficial) May 9, 2019

Despite its association with Billdesk, a platform supervised by RBI and is a participant under the country’s Payments and Settlements Systems Act 2007. The Billdesk further has investments from two of India’s leading public sector banks namely, State Bank of India and Bank of Baroda.

Following Coinome’s announcement, Coinnome users have alleged that they have been facing technical difficulties with withdrawals of bitcoin cash (BCH) and bitcoin SV (BSV).

BCH and BCHSV withdrawals are disabled. Can you tell when this will be enabled?

— Sivannarayana Billa (@billasiva001) May 9, 2019

Local news outlet Quartz cites an alleged Coinome email in a May 10 report that has been received by the consumers,  providing more details about the recent developments:

“India is currently going through uncertainty on crypto guidelines and regulations. The government of India has not yet taken a decision on the regulatory framework for crypto exchanges or wallets. Further, the supreme court is yet to act upon the public interest litigation (PIL) on (the) regulation of crypto assets.”

Since last July, when RBI’s controversial ban came into effect, the cryptocurrency ecosystem in the country was gravely affected. Both public and industry-led petitions have been filed with the supreme court of the country, however, the decision on the same is impending.

In October 2018, major exchange Zebpay was pushed by RBI’s policy to shut down its shop. Crypto Exchange Coindelta also closed shop in April this year  Citing Inimical Regulatory Conditions.  In the same month, Unocoin exchange fired half its staff, leaving the company with 14 workers.

Read more:How the banking sector will be reshaped by blockchain in upcoming years

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