As the government still acts clueless over the matter of Cryptocurrency, we received information that the banks are taking action over individuals trading in cryptocurrencies like Bitcoin, Ethereum, Ripple and other Altcoins.

ICICI Bank, India's premier bank sent notice of Account closure to Mr. Aniket, who's name has been changed as he wishes to remain anonymous. Here's a small excerpt from the notice.

We would like to inform you that the transactions conducted in the captioned account are not satisfactory in nature and conduct. Hence, we shall be constrained to close the account by January 25, 2018.

"The people in the branch say they have no problems with the account, but they can't do anything as this letter was sent by the backend team", Aniket told FinallyJobless.

The actual notice sent to Aniket from ICICI bank

It must be noticed that the bank did not exclusively mention what sort of transactions from Aniket's account were not satisfactory.

"They called me back in October or November", Aniket recalls. "They asked me the nature of the huge transactions to which I replied I trade in virtual currencies. I told them that I trade in Bitcoin".

Aniket was asked to visit the branch by the bank officer on call to sort this out. He carried all his invoices and documents as proof of each and every transaction. The branch gave him an assurance that he has nothing to worry about, his account is in good condition.

"It was a shocker when I received the notice", he says. "Well at the end of the day, it's no big deal. I had this account since 2014. Now, if not them, we will try some other bank", he says.

But are the other banks actually going to work? ICICI bank may not be the only bank in this party.

Account opening of entities dealing in trading of crypto currency or bitcoin is prohibited, reads a notice from HDFC bank, sent to us by another concerned trader who wishes to remain anonymous. "Is it safe to trade?", he worries.

Are banks aware of the consequences of withdrawing support from these exchanges?

“We know what will happen. But we don’t want to provide an official channel for this activity,” said the executive director of a Mumbai-based private bank in The-ken's latest report.

The letter to Aniket is an indication that Banks are and can in future use their power to curb the rise of Cryptocurrency trading in India, albeit only via official channels like Cryptocurrency exchanges.

Earlier we mentioned Four other sources to buy and sell Bitcoin without having a middle man like an exchange or Banks watching over you. This sort of passive crackdown may lead to more over-the-counter trade of cryptocurrencies. In FinallyJobless's opinion, Crypto-for-cash is the true form of money laundering. The exchanges are doing a great job at self-regulating the industry with appropriate KYC filing from their users. Each user has to submit 2 types of identification before they can start trading on the platform.

"I am going to pay the taxes. 20-30% doesn't matter when your returns are over 200%", notes a trader who has accounts in multiple exchanges

"When money goes out of your bank and comes back in your bank, it isn't hard to calculate your profits. I find the interference from the banks unnecessary. If Banks force exchanges to shut, I will sell my coins for cash. Then I won't bother paying taxes, will I?, she told FinallyJobless.

Instead of curbing the volume of Cryptocurrency, the government should come up with a guideline to regulate them. The exchanges aren't the problem, the individuals trading in high volumes on these exchanges aren't the problem either. But we cannot be sure what the next move of the government or the banks will be.

Despite the fears, there is no significant decrease in the trade of cryptocurrency. Koinex, one of India's leading cryptocurrency exchanges encountered a trade volume of over 10 crore XRP coins in the past week.

There are many new exchanges coming up in India with innovative solutions to handle the deposits and withdrawals, a positive sign for the growth of Crypto trading in India. We compared 16 such exchanges in India and we are yet to add the new ones.

Here's to hoping that the government doesn't make any hasty decisions and that the trading in cryptocurrency is regulated in a way that it doesn't hinder the honest tax-paying citizens of our country.

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