- Bitbns exchange announced INR 2.0, aka instant INR deposit service.
- P2P INR deposits are time consuming as user has to wait for the other person to confirm they’ve received the money. Bitbns is removing the waiting period.
- Bitbns confirms deposits immediately, as long as the amount is less than 80% of your net worth (INR value of your total holdings.)
- We test the instant deposit system.
Buying and selling cryptocurrency using INR (fiat) isn’t straight forward for Indians. In July, RBI’s diktat came into effect forcing banks to close their relationships with the exchanges. Since then the innovation friendly exchanges of India have come up with multiple ways to allow depositing and withdrawing INR.
Bitbns allows you to deposit or withdraw INR using a Peer to Peer transaction system. If you want to deposit INR you’re matched with a user who wants to withdraw INR. You send the money directly to the matched user, once the receiver confirms, your INR balance is updated on the Bitbns wallet with the deposit and the receiver’s wallet is updated with the withdrawal amount.
Simple enough? It is. But there is one tiny problem.
What happens when the withdrawer does not quickly confirm the receipt of money in their bank account? The depositor has to wait hours for the dispute to settle in some cases before he or she sees the money in their Bitbns wallet.
Hence the need for Instant Deposits
On Friday, Bitbns exchange announced a new instant INR deposit system, working in conjunction with their existing P2P INR deposit and withdrawal system.
Under the new system, a user’s deposit is confirmed instantly as long as the amount is less than 80% of the user’s net worth. If the user holds cryptocurrency worth 1,00,000 INR, the user can instantly deposit upto 80000 INR.
The ease of instant deposit then opens up avenues for trade or arbitrage as per depositor’s requirement. Here’s an example:
If you are holding 1 BTC and you see an arbitrage opportunity, you can just do instant INR deposit, withdraw crypto and complete your loop even before withdrawer confirms it.
Let us not forget that Bitbns has a very high number of withdrawals pending, the instant deposits will likely lure in more depositors to the exchange. Even the crypto prices are at a premium on Bitbns due to the delay in withdrawals.
As convenient as this sounds, it isn’t easy for everyone. Bitbns is using a combination of parameters to determine the viability of offering instant deposit service to their users. In the official announcement, it reads,
“We have created a sophisticated mechanism which tracks a user’s probability to default, and takes into account their overall holdings and average response time on P2P INR Deposits & Withdrawals, and a few more.”Bitbns
We Tested it
What good is a feature if it doesn’t work? We thought of testing the instant deposits for the article. We tried the deposit at 2:00 AM, technically having a a better chance at withdrawer not updating the status of funds immediately than in the morning – perfect to see if the deposit is instantly credited.
On the P2P INR deposit page I get an option to check a box for instant deposits. The maximum value of INR I can instantly deposit is shown under the box. If you go by my account, I am a tiny little fish in the sea of whales. But now, you all know my balance on Bitbns.
I created the INR deposit request for 5000 INR.
In less than a minute I was matched with a peer for depositing INR 5000. Luckily I also got 1.1% tip for the deposit. It might just be a viable business to keep depositing INR earning 1-2% tips and withdrawing them at 0.5%.
Now, if you’re anything like me, you’d think, I can just say I deposited without actually depositing money and the instant deposit will be credited. But you have to enter the UPI/IMPS reference number before clicking that “Submit” button.
You can lie about the number and it may get through, but you still can’t withdraw it and eventually get caught, be penalised and possibly banned from the exchange.
I transferred the amount, entered the reference number and hit ‘submit and complete’ button.
Within seconds, 5000 INR were credited into my wallet. Even when the withdrawer had not confirmed the transaction. IT WAS ALMOST INSTANT.
The 1.1% or 55 INR tip however will remain pending until the withdrawer confirms the transaction. As I expected, this late at night, the withdrawer did not confirm the transaction and hence I raised a dispute. So everything else in the process remains the same.
I received the tip in the morning.
Conclusion: Instant deposits work.
Fool Proofing the system
Once again, if you’re anything like me, you’d be finding loopholes in the system. So I tried few and here’s a quick summary of where I ended up with them.
- Opening a new INR deposit request while the previous one is still not confirmed by withdrawer is not possible.
- Withdraw the amount, your queue is set to “zero” and it will be stuck there indefinitely.
- If you still play around with it and get caught, you stand to be penalised at 5% of the amount (max 500 INR).
Fortunately I did the testing and informed Bitbns about it so neither my rank was affected, nor was I penalised.
So, that’s it. You can now deposit INR on Bitbns instantly, albeit only 80% of your net worth. Have you tried it yet? Share your experience in the comments below.
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