Crypto exchanges suffer since 2021, but RBI doesn't give up
India crypto exchanges continue to suffer while RBI seeks another purpose for blockchain
By Shashank Bhardwaj
For a long time, the global crypto market has been declining, and the Indian market is experiencing the same issue. Indian government’s overly restrictive policies concerning cryptos, as well as the ‘anti-crypto’ stance of the Reserve Bank of India, have resulted in the crypto exchanges suffering incessantly.
On June 25, Bloomberg reported that while the big names in the crypto industry are laying off employees, most Indian businesses are treading carefully as they prepare for the crypto winter and the implementation of a new tax rate regime for cryptos.
The changes in the Indian crypto market are evident as trading volume on WazirX, a popular crypto exchange in India, dropped 95 percent since October last year due to new tax regulations.
Crypto winter has made its presence felt in India more than in any other country. Many factors contributed to the losses, including a bearish global market, a geopolitical situation, and restrictive regulations in India. Because of the scepticism revolving around cryptos, the Reserve Bank of India has remained hostile to it. Furthermore, the finance and commerce-related ministries have expressed reservations about crypto regulation, impeding the growth of crypto exchanges.
WazirX vice president Rajagopalan Menon said that last year was a watershed moment for the company because it went from having six programmers to hiring fifty in just seven months. He did, however, assure that, while no major layoffs are planned, the company is cutting all non-critical costs in order to survive the crypto winter, so they are only hiring for key positions. He said, "We are hiring only critical hires, we aren’t spending money at all. It’s literally crypto winter here."
To deal with the crypto winter, crypto exchanges and other industry businesses have been forced to reduce their staff all over the world. India is not the only victim of crypto winter, as profits at various crypto exchanges around the world have fallen.
The market crash has impacted major companies such as Coinbase, Robinhood, Bitso, Bybit, and others. Despite the fact that the Indian government has not implemented regulations, it has rushed to impose taxes that have been criticised by investors. It has slowed blockchain and crypto adoption and uses in India.
The Reserve Bank of India has yet to finalise its plan to test blockchain technology in the banking system. RBI, though, is collaborating with other banks and international companies like IBM for the implementation of blockchain tech to curb frauds in the Indian banking ecosystem.
RBI will be able to move forward with the implementation of new policies once the pilot project has produced the desired results. As a result of the delay caused by red tape, the Indian market has suffered greatly while crypto exchanges wait for better days.
Shashank is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash