India’s stand over cryptocurrency is still not clear to anyone. On one hand, the government is planning to regulate it, while on the other hand, banks have started imposing obstacles to such trades.
Following Indian banks’ unpredictable services to the crypto exchanges, the crypto investors are now turning to peer-to-peer (P2P) platforms and WhatsApp or Telegram groups to facilitate crypto trading in the country.
A week ago, the State Bank of India (SBI) issued an order asking the banks to stop offering SBI UPI services to individuals and businesses related to cryptocurrencies.
In the last few weeks, several Indian crypto exchanges have experienced a surge in the adoption of cryptocurrency on their platform, but 60-80 percent of all those transactions a processed through P2P platforms and WhatsApp and Telegram groups, according to a report.
The report further stated that earlier, not many investors opted for these methods, but a week ago, when the SBI blocked fund receipts by crypto bourses on UPI, a greater number of investors turned to P2P platforms and WhatsApp and Telegram group.
Almost 80 percent of crypto transactions are now being processed through these new methods and compared to last year, the transaction on crypto exchanges have increased by 10-15 percent.
In India more than 90% of the users who come onboard from fiat currency use the P2P marketplace. A large chunk of users also prefers to directly deposit their cryptocurrency on the OKEx platform to make use of the advanced trading features,” said Jay Hao, CEO of cryptocurrency exchange OKEx.com.
Presently, most crypto exchanges in India have started offering P2P transaction options to their users. In order to process this kind of transaction, the buyer can directly exchange fiat money against crypto from another user.
Recently, Nischal Shetty, the CEO of WazirX said, “P2P is not a way to trade crypto, but instead, it’s a fiat to crypto on-ramp solution. In the absence of banking options during the banking ban, people would use P2P to convert their fiat to crypto (USDT) and vice-versa. Ever since the banking ban has been struck down by the Supreme Court, most users prefer banking to P2P to deposit/withdraw INR from WazirX.”
According to some of the exchanges in India, there are several other banks that are still offering their services to them.
A few months ago, the Reserve Bank of India clearly stated that the banks could not use its 2018 circular that imposed the blanket ban on cryptocurrencies, as it was already revoked in March 2020, by the Supreme Court of India.
Apart from this, several crypto exchanges have started offering Systematic Investment Plan (SIP) services to their users.
“Investors can earn interest up to 1800% in a 5-year SIP plan which is unmatched by any other asset class in the world,” said Shivam Thakral, CEO of BuyUcoin.