Binance, a leading cryptocurrency exchange, has ceased allowing cash payments for peer-to-peer (P2P) cryptocurrency transactions in India. This means that users in the country can no longer purchase or sell supported cryptocurrencies using cash deposits or receipts.
Indian Binance P2P Users Are No Longer Able to Use Cash
Indian traders could previously terminate deals after receiving money or having it directly transferred into their bank accounts by using Binance's escrow service. Traders took advantage of this choice to keep trading beneath the radar and to minimize the possibility of government intervention. In order to avoid having to pay high taxes levied by the government, several dealers also favored the cash option over internet financial transfers. The monetary option has been discontinued, but there are still other options available.
The exchange probably took this action to ensure that users could no longer use the site to circumvent laws, such as those pertaining to taxes, and for compliance purposes. However, a safety concern with the cash alternative has also been brought up by several parties.
Recently, the creator of the blockchain and cryptocurrency law business Crypto Legal brought attention to a few of these issues. Purushottam Anand asserts that there are significant risks associated with both money and health.
"There have been instances where traders have been physically abused and coerced into giving over cash or transferring their virtual assets during in-person encounters. Because of regulatory uncertainty about the legality of such transactions, victims are reluctant to file criminal complaints, especially if the transaction involves more than ₹2 lakh, and fraudsters take advantage of this anxiety," he said.
Given that the transactions in question do not technically violate any local regulations, Binance's decision may indicate a desire to cooperate with the Indian government. According to reports, the exchange just acts as a third-party agent, offering escrow services to anyone wishing to trade cryptocurrencies—assets that aren't recognized as legal money in the nation.
P2P cash payments are no longer offered by Binance, although users can still settle trades in Dubai by direct AED cash deposits or exchanges. Compared to India, the Dubai government is far more open to cryptocurrencies.
The Crypto Scene in India
A number of other cryptocurrency exchanges may choose to follow Binance's lead and stop accepting cash payments for peer-to-peer trading. This might significantly dampen the nation's cryptocurrency scene.
India's approach to cryptocurrencies appears divided among its authorities. While the Securities and Exchange Board of India (SEBI) aims to establish a regulatory framework allowing investor participation in crypto trading, internal documents reveal SEBI's proposal to distribute regulatory responsibilities. SEBI suggests that digital assets won't fall under a single agency's regulation; instead, the Reserve Bank of India (RBI) would oversee stablecoins and fiat-backed cryptocurrencies, while SEBI would regulate other assets.
SEBI also proposes involving the Pension Fund Regulatory and Development Authority (PFRDA) and the Insurance Regulatory and Development Authority of India (IRDAI) in overseeing pension-related cryptocurrencies.
Conversely, the RBI opposes the entry of private cryptocurrencies into the financial market and is considering a ban on stablecoins.
June 2024, Cryptoniteuae