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Crypto Market Crashes in India over Exchange Warning

India’s regulatory response to Cryptocurrency has not been in favour of cryptocurrency trading. We know that by now. The markets remained unaffected for over 10 weeks until yesterday. In a first of a kind announcement, Zebpay, India’s biggest cryptocurrency exchange by volume warned its users of dismissing fiat (INR) services abruptly. The announcement is titled “Your Rupee Withdrawal Could Stop”.

Zebpay announced an interruption in services over regulatory concerns in india
Announcement by Zebpay

Markets Crash

What followed and still continuing across the Indian market is ‘Panic Selling’. Within minutes of the announcement Bitcoin price went down by more than a lakh on Zebpay. The alts followed suit. XRP prices reached Rs. 28, IOST prices reached Rs. 1.6, VeChain was selling for Rs. 150 and so on. These prices were atleast 20% less compared to international exchanges.

For a brief period it seemed like the prices were stabilising, and for most part of the day they remained lower than international exchanges but didn’t move much. Zebpay later released an FAQ for their announcement and assured users that ‘INR withdrawals will work till the banks permit’.

The FAQs may have helped some users to calm their nerves down. However, the titular virus has spread and some alts are selling at over 20% less prices on Indian exchanges as of now. Zebpay’s announcement crashed the market for all Indian exchanges.

prices are at 20% discount in India for cryptocurrency
The Price Spread Across Alts in Multiple exchanges. Source: KoinKnight

Some Saw an Opportunity

While many traders sold their crypto holdings, possibly at a huge loss, some saw an opportunity to buy it cheap. Many users on Twitter and our telegram group were depositing INR and scooping up crypto at a so-called ‘discount’.

FUD or not, the regulatory deadline is close and if banks do not co-operate with the exchanges, the INR withdrawals will eventually be shutting down. The deadline is July 5, 2018. But there are many ways to keep your investment safe or keep trading.

[Read: What are the options for Indian Traders after July 5]

Was Zebpay right in making the announcement? What do you think? Let us know in the comments below:

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