In Brief:
- Kotak Mahindra becomes the first bank to reopen doors to the crypto community after an 8-month payment freeze.
- Crypto exchange WazirX opened an account in Kotak which will allow crypto trading for WazirX investors.
- Kotak has also been in contact with other crypto exchanges like Zebpay.
Kotak Mahindra Bank surfaces as the first leading bank to reopen doors to the crypto community, after being on an 8-month payment freeze by banking institutions.
According to the Economic Times report, Kotak Mahindra is set to provide services to WazirX, one of the country’s top crypto exchanges, to start a new venture following months of payment freezes by most high-street banks that continue to boycott the crypto market.
WazirX has opened a bank account with Kotak, which will be used to receive and pay money to WazirX investors who trade in the platform.
Right now, the account is yet to become functional. The necessary paperwork, KYC, and some other tests are taking place.
Despite the fact that crypto investments are negligible in comparison to other financial assets, cryptocurrencies could become an expanding asset class if the government, which is working on a new crypto bill, authorizes local trading of selected crypto.
Kotak bank is warming up to the idea of crypto trading and has been in contact with other cryptocurrency exchanges such as Zebpay.
RBI had banned banks from enabling payments for cryptocurrency transactions in 2018. Different institutions have interpreted the RBI statement differently, and most banks have yet to recommence dealings with cryptocurrency exchanges.
Most bank officials and relationship managers discourage customers from investing in cryptocurrency because it pays no commission to the banks.
Due to RBI pressure, WazirX canceled its account with ICICI Bank last year. In fact, MobiKwik, a digital wallet and payment services provider, had to take over much of the exchange’s activity.
