After prime private sector banks started commanding payment gateway companies to abort services to many crypto exchanges in India over the past month, Paytm Payments Banks Ltd. (PPBL) had come to rescue the exchanges. But Paytm too has now halted servicing the exchanges via payment gateway channels. The effect was visible and one exchange, Zebpay sent out emails to its clients saying Paytm deposit and withdrawal services will no longer be available on its platform.
Paytm Payments Bank Ltd. (PPBL) has neither formally stated any reason for this nor said whether this was because of any regulatory issue. PPBL won’t allow people to sell or buy virtual assets through its platform from May 21, 2021 evening. It will stop dealing with crypto exchanges.
Earlier this week, many banks were said to have broken ties with crypto exchanges like WazirX, Zebpay, and BuyUCoin. Many prime crypto exchanges said that many processing companies have expressed their intentions to withdraw support.
It is stated that RBI has commanded payment processors to stop dealing with crypto exchanges. In the instance of the banks, the apex bank hasn’t issued any written order to the payment gateway firms. Paytm’s decision to abort crypto exchanges came after virtual currencies especially Bitcoin encountered several fluctuations.
Crypto exchanges have established onboarding payment processing entities, specialized wallets and using banks abroad, over the last few weeks. Some of them even created ‘offline’ systems to allow investors to access digital assets. However, crypto exchanges will now be left with limited alternatives to accepting investments from investors from India.
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