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Another largest crypto exchange of India ‘Koinex’ is shutting down due to the unclear regulatory framework

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Another largest crypto exchange of India 'Koinex' is shutting down

Koinex the largest crypto exchange of India announces on June 27th 2019, about the termination of its exchange services. Trading on all platforms will be suspended at 2 PM IST, 27th June 2019. Rahul Raj the Co-founder of Koinex announces about the shutdown via a medium blog post. Unclear regulatory issues and crypto framework has led to the shutdown of Koinex as said by Rahul in his blog post.

Koinex started its digital exchange services on August 25, 2017, and soon became the largest crypto exchange of India. Koinex recorded a whopping $265M in trading volume and on boarding 40K+  new users in 24 hours at the peak in the month of December. 

On April 6, 2018, Reserve bank of India (RBI) issued a circular instructing all regulated financial services entities not to deal with cryptocurrencies in any form and ordered them to exit the business within three months from the date of issue of the circular.

However, the decision of RBI was challenged in the Supreme Court of India but till now the regulatory framework for cryptocurrencies has not been clarified.

Rahul said, “The recent news broken by BloombergQuint and later reported by MoneyControl about a proposed piece of legislation called the ‘Banning of Cryptocurrencies and Regulation of Official Digital Currencies Bill 2019’ has created enough FUD in the Indian crypto trading community to result in a sharp decline in trading volumes and instil a clear discomfort for all the law-abiding citizens of this great nation”.

Crypto & INR Withdrawals

Users can safely withdraw their cryptocurrencies from Koinex. The withdrawal deadline for cryptocurrencies from Koinex is 9 PM IST, 15th July 2019 and in order to improve the safety of the digital assets, Koinex has added an additional layer of safety i.e. Withdrawal Confirmation via IVR Call.

And for INR withdrawal Koinex will start releasing all the users INR balances to their registered bank accounts once the trading has suspended. According to Koinex website, they will try and complete these transactions in the course of the next 5 weeks.

Next What?

One by one almost all crypto exchange is shutting their services in India stating common reason of regulatory uncertainty in the country. WazirX another crypto exchange of India tweets,

“Koinex shutting down is an unfortunate news, but crypto is NOT over in India. We welcome all Koinex users to move on WazirX. Deposit your cryptocurrency funds on WazirX, and claim Flat 1% Bonus on your deposits. Hurry up!”.

Bitbns also stated via a tweet, “It is not easy to say bye to a good friend. Koinex had been an inspiration for Cryptocurrency Startups in India.” Bitbns is also offering fee refund on all deposits to grab the customers of Koinex.

Ashish is a cryptocurrency journalist who has been passionately involved in the bitcoin space since 2016. His interests lie in bitcoin security, open-source systems, network effects and the intersection between economics and cryptography.