Another fascinating angle to look at the stringent crypto policies in India is that it has now opened an entry for crypto firms to start considering relocation crypto friendly countries such as the blockchain island of Malta, which has gradually become a “crypto Silicon Valley.” Zebpay, which happens to one of biggest crypto exchange in the second most populous country in the world, appears to have moved on.
According to Quartz, Zebpay has officially registered an office in Malta with the purpose of providing services which are not restricted to “Crypto Silicon Valley” alone but also expected to extend to other European countries. The crypto trade firm went on to list about 20 countries whose citizens and residents are eligible to use the exchange platform; this is including major European countries such as France, Germany, Italy, the Netherlands, Ireland, Sweden, and Denmark.
The “Crypto Silicon Valley”
According to its website, Zebpay has been incorporated under the name Awlencan in Malta; the website revealed that:
“For all intents and purposes, Zebpay shall mean and include below – Awlencan Innovations Malta Limited [C-88318], a Maltese Registered Company with Office Address situated at: 48, Triq Stella Maris, Sliema, SLM 1765, Malta, which owns and operates the ‘Zebpay’ VFA Exchange Platform in Malta, hereinafter referred to as “Awlencan” or “Zebpay” or “company”
Last month, it was reported that Zebpay broke the seemingly bad news that it would be shutting down operation in India; a decision that sent down chills down the “throat” of the Indian crypto ecosystem.’ According to Zebpay, this was as a result of the ban placed on the financial institutions which restricts the exchange from offering banking services to crypto businesses. Zebpay explained how the Central bank’s decision had slowed down operations on its platform:
“The curb on bank accounts has crippled our, and our customer’s, ability to transact business meaningfully,” stating further that: “At this point, we are unable to find a reasonable way to conduct the cryptocurrency exchange business.”
Prior to the clampdown by the Indian central bank, the exchange was experiencing significant growth. For instance; just three years after its launch, Zebpay already recorded approximately three million users, with hundreds of thousands of new users joining each month to show for its existence. No doubt, the banking freeze was really a blow on the exchange!
Brain Drain in India Blockchain Space
Notably, the bank freeze, after being announced in April 2018, has proven to be affecting not only the digital currency exchanges but also a broader blockchain ecosystem in the world’s sixth-largest economy by nominal GDP. As parts of the adverse effects of this stringent regulation, the Indian government could be causing a brain drain in the country’s cryptocurrency and blockchain space. For a country like India, this is not so good, as it might significantly increase unemployment.
Also, major businesses and investors in the crypto sector are moving out of India to make investments in other countries considered to be crypto conducive such as Switzerland, Estonia, and Thailand. This is precisely what follows a clampdown on any sector.
Though enthusiasts are still waiting to see whether or not the Indian government would change its position on the crypto sector, it seems as though enthusiasts might have to wait forever because the Indian government is not reversing its position, instead, it is making more stringent rules. For instance, a government panel will possibly table a report in December proposing the holding of unregulated crypto assets to be illegalized.