Friday, 26 May 2017

Bitcoin Demand Crashes Site in India, as Overwhelmed Exchanges Put Limits on Purchases

The demand for Bitcoins has increased across the entire world, ultimately causing a rise in its price to all-time highs. In India, with tens and thousands of new users flocking to Bitcoin each day, exchanges have already been overwhelmed ultimately causing downtime and slow processing of transactions.
The unprecedented demand for Bitcoins has can be found in the back ground of the us government requesting feedback about virtual currencies from users.

Exploding demand, high premium

"Zebpay, certainly one of India's Bitcoin exchanges, has over 500,000 downloads of its mobile app and is adding about 2,500 new users every day."
The scarcity of Bitcoins in India has triggered Bitcoin being traded at a substantial premium. The Bitcoin price in India touched INR 225,000 ₦1.3M (~$3,500) before declining slightly. International users cannot arbitrage the demand for Bitcoins in India because of capital controls and foreign exchange regulations.

Exchanges overwhelmed

Just how are exchanges coping with this particular overwhelming demand?
Zebpay urged investors to be mindful while buying Bitcoins, citing the high volatility
Zebpay tweeted “Bitcoin costs are very volatile right now. Please be careful when investing. This can be a new technology innovation on a worldwide but early stage. Your investment should match your knowledge. Be safe!”
However, this didn't have the intended impact on Bitcoin investors. Zebpay later introduced an everyday limit of INR 50,000 ₦296K (~$780) on Bitcoin purchases.
Zebpay tweeted:
The specific situation was no different at other Bitcoin exchanges. Coinsecure, certainly one of India's leading exchanges was down, citing the exponential growth of users causing strain on the Company's systems. The organization expects the downtime to carry on over the following few days. Visitors to the internet site were greeted with the next message.

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