The zero-fee exchange succumbs to operational costs and the RBI’s strict rules against providing services for crypto-related businesses.
Indian cryptocurrency exchange Coindelta abruptly announced the termination of its services over the weekend, suspending trades and canceling all open orders on Saturday, March 30. Making note of the team’s struggle to keep the exchange operating over the last six months, Coindelta cites its financial issues and the Reserve Bank of India’s (RBI) strict crypto regulations as major reasons behind the exchange’s decision to shut down.
After launching Coindelta in September 2017, the exchange announced a month later that the platform would allow users to buy and sell cryptocurrencies at zero fee, with maker fees at 0 percent and taker fees at 0.3 percent. According to Rajdeep Singh, the exchange’s co-founder, the low fees were meant to increase competition between makers and boost their profits, as well as help takers get a better price when either buying or selling.
While the low trading fees helped Coindelta maintain a favorable trading environment for its users, Shubham Yadav, another co-founder of the exchange, said it became too expensive to operate within the country’s unfavorable crypto environment. “We have been operating at a minimal trade fee, bearing all the costs ourselves ensuring that your trading experience remains unaffected in the current unregulated environment,” Yadav explained. “Economically, it’s no longer viable to continue with the exchange.”
On top of operational costs, the exchange’s closure announcement also mentions the RBI’s move to prohibit domestic banks from providing services to crypto-related businesses. In April 2018, the RBI ruled that entities regulated by the country’s central bank could no longer provide services to any individuals or businesses dealing with virtual currencies, including crypto exchanges.
Coindelta stated that the RBI’s crypto service prohibition negatively impacted the exchange’s ability to provide seamless deposit and withdrawal services. Coindelta’s claim echoes that of Zebpay, an Indian crypto exchange that ceased operations in September 2018 because the RBI’s ban had diminished the exchange’s ability to conduct business in any meaningful way.
As for Coindelta’s users, the exchange will continue to provide its wallet services until April 29, with customers expected to withdraw all funds within the next 30 days. According to the exchange’s statement, all withdrawals will now have a fixed fee attached, with Coindelta providing a fee page to outline the exchange’s new rates. As Coindelta’s users prepare to leave the platform, crypto exchange WazirX announced it would cover the entire withdrawal fee for users who transferred funds to its platform.
Nicholas Ruggieri studied English with an emphasis in creative writing at the University of Nevada, Reno. When he’s not quoting Vines at anyone who’s willing to listen, you’ll find him listening to too many podcasts, reading too many books, and crocheting too many sweaters for his dogs, RT and Peterman.
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Source: ETHNews
