Although crypto winter is here, investors should not worry as their funds are safe with the platform, the company said.
India’s largest crypto exchange by value – CoinDCX – has extended the withdrawal restrictions that have been in place since May 13 until further notice. It said these extreme steps are necessary to implement enhanced compliance and risk frameworks.
After many investors took to social media to express their frustration over the pausing of withdrawals at CoinDCX, the company put out a statement where it mentioned new compliance measures being taken as the reason for the suspension of deposits and withdrawals.
Replying to the complaints, Ramalingam S, Head — Brand, Marketing & Communications – CoinDCX, tweeted, “While some wallets are under maintenance, there is a larger compliance requirement due to evolving regulatory needs resulting in increased scrutiny. The new process is being rolled out in phases, & it will reach all users in due course. Until then, I request your support.”
In April, CoinDCX raised $135 million in a Series D funding round at a valuation of $2.15 billion, led by Steadview and Pantera.
Suspension for System Upgrade
On May 13, the crypto trading platform announced that deposits and withdrawals will be disabled until further notice to implement a system upgrade – wallet maintenance service.
“We’d like to inform you that the ongoing wallet maintenance service has been extended until further notice. We are trying our best to complete the upgrade at the earliest possible and keep you posted. During this time, deposit and withdrawal services will continue to remain suspended on our exchange,” CoinDCX had said in a statement on May 13.
Enhanced Compliance Requirements
But even after one month, when the withdrawal service was not restored, complaints started flooding social media.
On June 20, the company once again put out an announcement to say that deposits and withdrawals will remain suspended for now to meet enhanced compliance requirements.
“Due to enhanced requirements for providing seamless INR deposits & withdrawals, CoinDCX has been strengthening its compliance and risk framework,” it said on June 20.
CoinDCX said integrating compliance and monitoring tools such as Coinfirm, Solidus Labs, Signzy, and Digilock, along with enhanced KYC coverage and risk frameworks around deposits and withdrawals, is being implemented.
“Crypto deposits & withdrawals remain disabled for everyone by default. One must follow an enhanced due diligence process to enable crypto deposit/withdrawal. The policy on the same will be released in the next 14 days,” it added.
Pausing Timed with Market Crash
May 13 was when Terra Luna hit its all-time low to virtually $0, which set off a massive sell-off that left the crypto market with a setback of over $1 trillion, forcing top players such as Celsius to freeze withdrawals and transfers of crypto assets.
Indian crypto exchanges, including CoinDCX, disabled deposits in INR after the inter-bank instant payment and settlement service UPI was denied to them by the regulators through a statement on April 7. The first two weeks of April saw a massive fall in trading volume attributed to the kicking in of the new taxation policy – 1% TDS and 30% capital gains tax.
Ready to Fight Crypto Winter
Meanwhile, in yet another statement, the trading platform assured investors that their funds are completely safe with the company and they don’t need to worry.
“We are backed by global investors who trust in our vision and belief. We continue to expand our workforce to build the next generation of crypto in India with DCX ventures, investment and trading platforms in a compliant and secure manner,” CoinDCX co-founder and CEO Sumit Gupta said in the statement.