One of the largest cryptocurrency exchanges in India, Zebpay, is shutting down its exchange activities due to the crypto banking ban imposed by the country’s central bank. “At this point, we are unable to find a reasonable way to conduct the cryptocurrency exchange business,” Zebpay wrote.

Zebpay Stops Exchange Activities

Zebpay announced on Friday the shutdown of its popular crypto exchange, which according to its website has over three million users.

“Despite regulatory and banking problems along our journey, we continued to look for solutions as we did not want India to miss the bus of digital assets that power the public blockchain,” the exchange wrote. However, Zebpay admitted:

The curb on bank accounts has crippled our, and our customer’s, ability to transact business meaningfully. At this point, we are unable to find a reasonable way to conduct the cryptocurrency exchange business. As a result, we are stopping our exchange activities.

The exchange is canceling all unexecuted crypto-to-crypto orders on Sept. 28 at 4pm (Indian time). Customers’ cryptocurrencies will be credited to their Zebpay wallets. “No new orders will be accepted until further notice,” the exchange clarified but noted:

Zebpay wallet will continue to work even after the exchange stops. You are free to deposit and withdraw coins / tokens into your wallet.

Effects of RBI Crypto Banking Ban

The Reserve Bank of India (RBI) issued a circular on April 6 banning banks and financial institutions under its control from providing services to crypto businesses. The ban went into effect in July.

Shortly after the RBI issued its circular, Zebpay launched its crypto-to-crypto trading platform. In August, the exchange added trueusd trading.

However, the banking problem has been hurting Zebpay’s business. On Sept. 4, the exchange announced that it will return all users’ Indian rupees on deposit at the exchange. “We have been distressed at the raw deal crypto-traders are getting in India as a result of the banking problems,” the exchange described.

According to Unocoin, another major Indian exchange, “India’s biggest crypto population is not ready for the crypto-to-crypto trading,” CEO Sathvik Vishwanath toldnews.Bitcoin.com in September.

Meanwhile, a number of smaller exchanges have launched exchange-escrowed peer-to-peer (P2P) trading which they claim to have rapidly gained popularity since the RBI ban. Even the central bank has noticed the growth of P2P trading. In its annual report, the RBI wrote that “some trading may shift from exchanges to peer-to-peer mode, which may also involve increased usage of cash.”

A number of petitions have been filed against the RBI ban and the supreme court has been trying to hear the case since Sept. 11. However, the case has been postponed repeatedly.