India's Zebpay Crypto Exchange Warns Fiat Withdrawals Could Stop

zebpay3 june25

Zebpay, one of India's leading cryptocurrency exchanges, warned its customers last week that withdrawals in the fiat money, the Indian rupee, could stop soon.

The exchange issued the warning as the three-month time-frame given by the Reserve Bank of India for banks to end their existing services to cryptocurrency-related business, ends early July.

On April 6, the central bank banned India's banks from dealing in cryptocurrencies and from providing accounts to businesses and individuals dealing with such currencies.

Banks were asked to end their existing relationship with such entities within three months from the date of the ban.

Industry bodies of both cryptocurrency and mobile businesses have approached the Supreme Court of India against the RBI ban and the apex court has scheduled a hearing on July 20, about two weeks after the order comes into force.

The RBI imposed the ban after issuing three warnings regarding the risks associated with virtual currencies such as Bitcoin, since 2013.

Citing the RBI ban, Zebpay said on its website that "...if Zebpay bank accounts are disrupted, rupee deposits and withdrawals will become impossible."

"This can cause discontinuation of crypto trade based on rupees, or at least cause significant price movements."

Customer-protection and market-integrity are the primary objectives, Zebpay said.

The exchange clarified that it made the announcement now to allow its customers enough time to receive the information and make a decision.

"There can always be issues that can arise out of everyone rushing to sell crypto, or withdraw rupees at the same time quite close to the last date," Zebpay said in a FAQ section on its website.

Zebpay also said that it plans to allow crypto-INR pairs to trade even after closure of bank accounts, though it cannot guarantee that this will continue.

The exchange said that it will continue to offer cypto-to-crypto trading and the opening of new accounts is continuing with rigorous adherence to the KYC process.

The RBI ban reportedly was not backed by proper research into the cryptocurrencies and their market situation. However, the bank formed a three-member committee to study cryptocurrencies and their economic impact. The panel is expected to submit a report soon.

Indian media reports suggest that some cryptocurrency exchanges have shifted base from India, while others have informed the central bank that they are willing to be regulated.

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