Indian bank Kotak to partner with cryptocurrency exchange WazirX, reports say

The major commercial bank of India, Kotak, announced a partnership with the bitcoin exchange WazirX amid ongoing discussions about regulation norms in the industry in the country. This was reported by The Economic Times.

“WazirX opened an account at Kotak, which can be used to receive and disburse funds to investors trading on the exchange. The account has not yet started functioning,” said a source quoted by the publication.

According to him, the paperwork is proceeding and ‘testing’ is ongoing.

In 2018, the Reserve Bank of India (RBI) banned supervised institutions from dealing with digital assets.

In March 2020 the Supreme Court of the country overturned RBI’s directive. However, large banks decided to await a signal from the regulator and delayed resuming servicing of bitcoin exchanges.

In May the RBI confirmed that no restrictions remain. By late 2020, media reported that leading financial institutions in India restarted dealings with cryptocurrency exchanges and traders.

In spring 2021 it became known that RBI was pressuring banks, urging them to review their relationships with bitcoin exchanges and traders. According to some reports, a number of financial institutions allegedly warned customers against using digital assets and referred to the repealed directive. Later the regulator asked banks not to do this.

Earlier, Business Today sources in the Finance Ministry said that India will abandon a blanket ban on cryptocurrencies in favor of regulating them as exchange-traded commodities and would present the corresponding bill by 2022.

According to The Economic Times’ sources, the government will ban the use of digital assets for payments, but will allow trading and holding them, like stocks, gold or bonds.

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