India’s regulatory woes pertaining to cryptos now seem to be easing a little, despite the absence of a clear consensus. Regardless, the threat of private cryptocurrencies being banned has stalled for now, with the banking sector already opening its doors to the crypto-community.
In fact, according to a local media report, the country’s Kotak Bank has formed a business relationship with top crypto-exchange WaxirX. This development comes on the back of almost eight months of payment freeze followed by most leading Indian banks.
A source close to the matter was reported as saying,
“WazirX has opened an account with Kotak which can be used to receive and pay money to investors trading on the exchange. The account is yet to become operational. Paperwork, KYC, and some testing are on.”
This will allow investors trading on WazirX to pay and receive money through the bank account.
Kotak Mahindra Bank offers private banking services in India. It was the South East Asian country’s third-largest private sector bank by assets and market capitalization, as of November 2021.
WaxirX had closed its account with ICICI bank last year, the second-largest lender in the Indian market due to the RBI’s pressure. In fact, the exchange had to shift much of its business to MobiKwik, which is a digital wallet and payment services company.
Thanks to Kotak’s top position within India’s financial sector, this is further confirmation that cryptocurrencies would be regulated, instead of banned in the country.
The bank seems to be warming up to this idea and is already establishing a hold in the crypto-space. Especially since it is reportedly in touch with other crypto-exchanges like Zebpay as well.
This comes at a time when most leading banks in the country like HDFC, Axis, and SBI continue to steer clear of the industry. This, despite a ban imposed by the country’s central bank being reversed by its Supreme Court last year.
Many top players are now predicting an acceleration in future growth once the cryptocurrency bill is passed. In a recent interview, Jay Hao, CEO of Seychelles-based crypto-exchange, noted,
”When OKEx entered the Indian market early this year, we were optimistic about India’s strong policy framework we are now finally witnessing India’s crypto policy taking shape to ensure a better future for the entire crypto ecosystem in India.”
“We can now expect more foreign exchanges to enter India and invest in building the required technical infrastructure and hiring manpower to run their operations.”
On the contrary, leading financial journalist Sucheta Dalal believes otherwise, tweeting,
After a meeting by PM himself & talk of an outright ban, #CRYPTO industry has got govt to back-pedal furiously. investor safety be damned. Now #Kotak considered close to govt opens for #crypto business without waiting to see law! #FinMin @DasShaktikanta ? https://t.co/1Sc1k9vaMA
— Sucheta Dalal (@suchetadalal) December 6, 2021