According to many reports, Kotak has opened an account with WazirX and is completing the appropriate paperwork and test runs.
Kotak Mahindra has become India’s first big bank to accept cryptocurrency trading. It has opted to register an account with the WazirX exchange in order to accept and pay money to those who trade on the platform, amid growing speculation that the government does not aim to prohibit cryptocurrency but rather regulate it. Fearing a general prohibition on digital assets, most big banks halted payments a few months ago. The Reserve Bank of India (RBI) has also expressed concerns about the unpredictability of cryptocurrency’s effects on the existing financial system, which is primarily based on fiat currency.
According to many reports, Kotak has opened an account with WazirX and has completed the requisite paperwork and test runs. If all goes according to plan, investors trading on WazirX will be able to pay and receive money through their bank account. However, the two parties have yet to make an official declaration.
The announcement comes as the government contemplates legislation to manage the country’s cryptocurrency future. The majority of the country’s high-profile banks have been freezing bitcoin transfers for the past eight months.
According to an NDTV report, people and organisations who breach the government’s restrictions on cryptocurrency may face fines of up to Rs 20 crores and a 1.5-year prison sentence if they violate the planned legislation to regulate cryptocurrency in India.
The Reserve Bank of India (RBI) banned banks from supporting cryptocurrency transactions in April 2018. The restriction was lifted a year later by the Supreme Court. The RBI highlighted the Supreme Court judgement in May of this year when it told banks that they could now participate in the bitcoin market. Most banks, on the other hand, waited to see how the market reacted to the new RBI rule, as well as whether the government would prohibit cryptocurrency trading.