India crashed the price of bitcoin and that of ethereum in 2018, and twice, after the central bank there issued a diktat which has now been overruled by the Supreme Court.

That diktat prohibited commercial banks from dealing with crypto companies, leading to a warning on June 22nd 2018 by the biggest crypto exchange in India, ZebPay, that they might have to stop deposits and withdrawals.

“If you are holding any rupees, or depositing any rupees in Zebpay, there could soon come a time when we may not be able to honor withdrawal requests,” they said.

That coincided with a 7% drop in bitcoin and an 11% drop in eth. “Can India really be crashing crypto prices,” we asked at the time.

A clear answer came a few months later, on September the 5th, when ZebPay took down the Indian Rupee (INR) trading pair.

Our analysis led to the conclusion this act, maybe even fully on its own, had significantly affected the global price of bitcoin and eth.

Bitcoin’s price at the time of the Indian ban in 2018.

Taking it from the left, that big red candle after ’18’ on the chart above is June 22, the day ZebPay warns about fiat withdrawals.

Bitcoin fell at the time from near $6,700 to about $6,000, a drop of $700, with it again falling on September 5th by $700, this time from $7,400, to continue to fall to $6,100.

So the ban was worth about $2,000 off bitcoin’s global price taken in abstract where these two specific days are concerned.

Ethereum’s price at the time of the Indian ban in 2018.

For ethereum some $80 was shaved off its price on June 22nd 2018 from $530, and some $50 went out on September 5th from $290, close to 20%.

That makes it a 35% drop in total due to the Indian ban taken in abstract, showing just how much influence this market can have on the global price.

That’s because ZebPay alone has some 3 million Indian traders on its platform. There are many other exchanges too, and they’re now re-opening back to normal:

INR Deposits now accepted on @zebpay!

KYC verified members only to start. Use ZebPay app to bank transfer.

Due to high volume non-KYC and new customers may face delays. We appreciate your patience.

INR-crypto trading starts in a couple of days. Deposit now and get ready! — zebpay (@zebpay) March 6, 2020

So the trading has not even began, with eth’s price in particular coincidentally at the same level now as when India’s ban affected it two years ago.

For bitcoin it is sort of the same too, with the effects of price in abstract back then needing some nuance when looking forward because at the time fiat had already been deposited, and so had to be taken out kind of at once, while this time it needs to be deposited first.

Meaning you’d expect any effects to be more gradual, although the opening of trading is an instant moment “in a couple of days.”

In addition there were months between the circular being issued on April 6th 2018 and the closure of trading a few months after.

So the effects were gradual then too, with bursts in those two days we have highlighted.

Likewise now there might be an initial burst when the INR pair goes up, and then a more gradual upwards pressure this time.

Regardless of what price does, keeping India free where this space is concerned is a major victory.

It was close, and it could have gone differently, with China for example continuing to repress its people where cryptos are concerned and maybe where the air is concerned too , but to India we say welcome back to the brotherhood of global men.

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