The Indian crypto space encountered a lot of hurdles, mainly in the form of the Indian government trying for a piece of blockchain pie. However, much of their desires and wishes had to rest on a shelf. In this time, the crypto space witnessed Kotak and WazirX partnership to formulate a trading arena for the crypto traders. Now, this can pose a serious concern for the government.
The idea that a complete chain of currency and its proclamation lay precisely in the hands of people that rarely pleased any governing body. Thus the Indian government came up with a strategy to destabilize the crypto space and indefinitely make it harder for any kind of trade to go on with the digital currency. This led to the forming of the crypto bill that talks about a crypto free financial structure. Amid this crisis, how did the Kotak and WazirX partnership begin?
What Is WazirX?
WazirX is a cryptocurrency exchange of India that has served the Indian crypto space successfully for all these years. It is a subsidiary of the global crypto exchange Binance. The Kotak and WazirX partnership will be used by investors to pay and receive money for the purpose of trading.
Kotak And WazirX Partnership: How It Began?
Before the whole riddle concerning the legitimacy and legality of digital currency in India evolved very recently, WazirX was already in partnership with ICICI Bank. With the presence of an account with the mentioned financial institutions previously, most of its deals that were related to digital currency exchanges took place out of it.
However, owing to the predicted ban on digital currency exchanges by the Reserve Bank of India in 2018 along with complete opposition to such exchanges, WazirX had to change boats and began a partnership with MobiKwik, which is a digital payment and wallet service company.
Even though the full directive that concerns the ban of digital currencies was reviewed and kept aside by the Supreme Court in 2020, the assembled skepticism related to the viability of the digital currency in the market of India remained.
The complex idea related to the currency attained such degrees that except the public banks, most of the private financial institutions folded their services and restricted any business that had to deal with cryptocurrency. The complete process of private players like ICICI Bank, HDFC Bank, and Axis bank along with the biggest lender in the nation, State Bank of India, made the lives of individuals who wished to deal with digital currencies.
To put scenarios into perspective, in May, ICICI Bank instructed the operators of the payment gateway to deactivate all transactions that were made with ICICI’s Net Banking, by merchants who dealt with the purchasing and/or selling of digital currencies. Along with that, in August, the SBI also made sure that crypto merchants got the harsh end of the idea.
The bank directed payment processors to deactivate the SBI UPI system for all the crypto traders to ensure the banning of the receipts from “crypto bourses’ ‘ on its UPI channel. These examples were further added by Axis and HDFC banks who determined that it was for the better that they terminate all dealings with crypto traders and the totality of the crypto space.
Following the statement of the Supreme Court that set aside the directive of RBI concerning digital currency, it was the RBI that instructed the banks to be free to carry on transactions related to crypto. However, the mistrust had scarcely blown over as most financial institutions were, and still are, unsure of the navigations in which the digital currency may affect the industry.
However, it must also be mentioned that even though there is little commission in crypto, the whole premise of the digital currency is ready to take the globe by storm.
Hence, capitalizing on the volatile market, Kotak Mahindra Bank jumped down and offered the biggest cryptocurrency exchange in India with their own account. However, the profiteering mainly depends upon the next measure our government takes, mainly related to the content of the latest Crypto Bill. But if everything is in the place, this Kotak and WazirX partnership is going to be a big hit.
How Will The Kotak And WazirX Partnership Affect The Crypto Bill?
The latest Crypto Bill which has been outlined and sketchily presented in the Winter Session of the Parliament is one that is factious as it is strange. The very idea that a currency may prevail beyond the tenure of the reigning ‘overlords’ almost seems unrelatable to the Union government.
Unfortunately, it also implies that the chances of the Crypto Bill that is being passed without any discussion are as large as it is prominent. The Bill, in the core, has been designed by the Modi Government to restrict almost all digital currencies in the nation, mainly when it is used for the purpose of payment.
The bill mentions that there must be a
“general prohibition on all activities by any individual on mining, generating, holding, selling, (or) dealing” in digital currencies as a “medium of exchange, store of value and a unit of account”.
The contempt of any of these ‘regulations’ will guide to a knowable offense that implies that the individual may get arrested without any warrant, and in some scenarios, it may also be non-bailable.
However, with Kotak and WazirX partnership, the odds have shifted in the favour of the merchants. It is the ability of Kotak to evaluate that they are kept extremely positively upon the financial haven that is a digital currency that is portraying no signs of husking or stoppage.
The idea that its evolution is cognate to a treasure mine that most financial institutions are scared of taking that forward has only increased Kotak Mahindra’s assertion on the same. However, if the central government opts to expunge cryptocurrency from the very face of this country’s economy, the hit faced by India would be illimited.
The Bottom Line
The RBI has illustrated that the problem with crypto is its safety from being tracked thus, it is of relevance that the government guarantees that there are more effective routes of controlling the currency and tracking them. Banning cryptocurrencies would leave the users playing to catch up with the remaining world with no way of actually catching up to them. If the government sees the light successfully, they will not have to be the last ones still trying to catch up with the world. Blockchain is surely the future and there is no alternative to it. So this Kotak and WazirX partnership is indeed going to be a new game changer in the crypto space.