This week, the Indian cryptocurrency exchange CoinDCX said in a blog post that it had blocked cryptocurrency deposits and withdrawals for various customers, citing compliance, risk, and monitoring needs as the reason.
According to the statement made by the company, CoinDCX has been enhancing its compliance and risk structure in order to meet the increased criteria for facilitating seamless rupee deposits and withdrawals.
“This was accomplished over the course of the past six months through a series of steps.
These steps included improving KYC coverage, enhancing the risk framework for crypto deposit and withdrawal, and integrating with compliance and monitoring tools such as Coinfirm, Solidus Labs, Signzy, and Digilocker, among others.
We have been steadily reducing crypto deposits and withdrawals for various users over the past month,” it continued. “We apologise for the inconvenience.”
What kind of effects does it have on the investors?
CoinDCX noted that in order to use its platform, every user is required to complete their KYC. By default, cryptocurrency deposits and withdrawals will continue to be unavailable for everyone.
To permit cryptocurrency deposits and withdrawals, one must first complete an upgraded due diligence process. Within the following two weeks, the corresponding policy will be made public.
“When it comes to cryptocurrency deposits, even very old addresses can still be used across wallets, and they will continue to get payments sent to them.
We are now working to disable the feature in question. Neither deposits nor withdrawals of INR are affected in any way at this time.
The INR method is available for users to continue using for deposits and withdrawals, as usual, the company stated in a blog post.
The head of marketing for CoinDCX, Ramalingam S., tweeted :
“although some wallets are under maintenance there is a larger compliance requirement owing to evolving regulatory needs resulting in increased scrutiny” after the issue gained popularity on social media.
Do you mean that you can't transfer crypto from the wallet? Just like coinswitch?
I am sure they must have communicated to their customers before doing it?@watsubram can you please throw some light on this case?
— Kashif Raza (@simplykashif) June 19, 2022
The new procedure is being implemented step by step, and when it is complete, it will be accessible to all users.
Withdrawals freezed due to Market Crash:
On May 13, Terra Luna reached its all-time low, which was approximately $0, which sparked a large sell-off that left the crypto market with a shock of more than $1 trillion, leading to tops like Celsius.
Among the world’s biggest crypto lending companies, Celsius Network, halted withdrawals and account transfers early last month because of “intense market conditions.”
Users will still earn rewards while the delay is in effect, the platform said in a message posted to its website. “We are taking this move today to put Celsius in a better position to honour, over time, its withdrawal commitments,” it added.
In a volatile market for digital assets that have been impacted by rising interest rates, decreased liquidity, and the failure of the Terra blockchain last month, Celsius has had difficulty raising money.
Indian crypto exchanges including CoinDCX, as well as the inter-bank quick payment and settlement service UPI, had their deposits in INR disabled, and on April 7 the regulators issued a statement rejecting these exchanges and services.
A significant reduction in trade volume was observed during the first two weeks of April. to put into effect the new taxes policy, which includes a TDS of 1 percent and a capital gains tax of 30 percent.
Set for the Crypto Winter
Investors were reassured by the trading platform is yet another announcement that their money was entirely secure with the firm and they didn’t need to worry.
“We have the support of international investors that believe in our mission and values.
Sumit Gupta, co-founder, and CEO of CoinDCX said in a release, “We keep expanding our staff in order to establish the future generation of cryptocurrencies in India with DCX ventures, investment, and trading platforms in a compliant and secure manner.