New Delhi: RBI’s deadline given to banks to sever ties with entities dealing or trading in cryptocurrencies came to an end on Thursday midnight. The central bank had instructed all the banks to end their relation (if any) with companies that deal with cryptocurrencies three months ago – something that was strongly opposed by certain cryptocurrency companies and traders. Some of the crypto-tech companies have already shifted base from India due to the recent diktat.
It is worth mentioning here that the government has not yet given any clear guidelines on cryptocurrency but has asked banks to sever ties with crypto-trading firms and individuals. The move, however, will significantly hurt cryptocurrency tech companies and even traders who will not be able to approach banks for any such transaction. If you are still invested in any cryptocurrency, then here are a few things you should know
No money transfer Thursday night onwards: Buying and selling of bitcoins in rupee will stop from midnight as none of the banks will facilitate cryptocurrency trade. This means that if you are still invested in any cryptocurrency, you will not be able to transfer the money in your bank account from tomorrow. Cryptocurrency wallet and exchange platform Zebpay said in a statement to CCN, “Today we are disabling the rupee deposit and withdrawal options on the Zebpay app. This is being done in light of the bank account closures as per the RBI guideline.”
Buying Bitcoins to be costlier: Any person interested in buying bitcoin now will have to purchase the cryptocurrency from peers and it is expected to that they will have to pay a premium on top of the current exchange rate.
Peer-to-peer (P2P) transaction: From today onwards bitcoin investors in India will have a P2P trading option. Some exchanges are already working on a P2P model that will allow transaction between the buyer and seller directly, with exchange being mere a facilitator.
Black market: Since RBI has only banned banks from associating with any entities that deal with cryptocurrencies and not banned the cryptocurrency itself in India, it might lead cryptocurrency holders to use platforms like OLX or black market to convert their cryptocurrency into money at a much higher price.
Other trading platforms: Aside from P2P trading, some exchanges might resort to alternate solutions of the ban, like buying the cryptocurrency in foreign currency through platforms like Paypal. This might push the cost of bitcoin even higher as one would have to pay currency exchange charges on Paypal and then more charges to transfer the amount from Paypal to the bank account.