Crypto Bill Leads To Panic Sale, 20% Crash

Exchanges Expect Regulation To Check Grey Mkt, Boost Structured Use Of Digital Assets

- John Sarkar & Aseem Gujar

New Delhi/Mumbai: Indian crypto investors resorted to panic selling after the government listed a bill on Tuesday night seeking to ban private cryptocurrencies, while allowing an official digital currency by the RBI. Cryptocurrency prices in the Indian — linked to rupee — market crashed by up to 20% before recovering on Wednesday after exchanges allayed investors’ fears.

“On Tuesday night, we saw huge selling in the rupee (INR-crypto) market on WazirX. We saw a 15-20% crash in prices once investors engaged in panic selling. However, the market is showing recovery and is at a 3-4% discount currently. A similar knee-jerk reaction was seen in January, when the contents of the bill were disclosed,” said WazirX CEO Nischal Shetty.

“A lot of fear is being seen among Indian crypto investors, especially the ones who entered recently. However, we advise people to pay attention to (Parliament’s) winter session and derive conclusions based on it. The ban reports could turn out to be speculative,” crypto exchange BuyUcoin’s CEO Shivam Thakral said. The price of bitcoin, the largest cryptocurrency, was down 10% against the rupee at Rs 40 lakh on Wednesday evening (the crypto market is open 24/7).