Indian exchange Mudrex pauses crypto withdrawals until January 28

Indian cryptocurrency exchange Mudrex has announced that it has temporarily halted cryptocurrency withdrawals.

It says the pause is part of efforts to update its compliance suite, which aims to maintain its security standards and prevent misuse by bad actors.

Reaction and clarification

In a January 12 announcement, the exchange stated: “To improve the security of our platform and protect against bad actors, we have made the decision to temporarily halt cryptocurrency withdrawals until January 28 2025″.

Mudrex also assured users that INR withdrawals are not affected, crypto deposits are fully functional and all funds are completely safe.

Despite these promises, the announcement has received backlash in the crypto community. Crypto trader Vivan Live brought the matter to the attention of users on X and advised them to withdraw their funds immediately by converting their assets to INR to avoid potential problems.

Another community member, Aakash Athawasya, expressed skepticism about Mudrex’s intentions, claiming that the exchange never actually enabled such functionalities and only offered non-proprietary price exposure.

It also warned users to avoid the platform and instead use on-chain solutions, citing personal losses on Indian exchanges.

However, founder Alankar Saxena responded to the criticism, defending Mudrex’s support for cryptocurrency deposits and withdrawals. He noted that the company had always allowed users to access its funds freely, even when other similar entities limited such functionalities due to regulatory and operational challenges.

The temporary suspension comes amid rapid growth for the company, with its user base increasing by 200% and its December 2024 business volumes increasing 20 times to $200 million.

Regulatory pressures

Mudrex’s decision to stop crypto withdrawals also coincides with another exchange, Bybit, temporarily restricting services to its Indian customers from January 12, 2025.

The company blamed its decision on recent regulatory developments and the continuation of previous restrictions. As a result, customers are no longer able to open new stores or access products on the platform. However, withdrawals are still available.

Although India ranked highly in the 2024 Cryptocurrency Adoption Index, it still maintains high taxes on digital assets, including a 1% tax deducted at source (TDS) and a flat rate of 30% as income tax on cryptographic income.

In December last year, the country’s authorities accused several crypto exchanges, including Binance and WazirX, of evading tariffs. According to Pankaj Chaudhary, Minister of State for Finance, Nest Services Ltd, a company linked to Binance, faces nearly $87 million in unpaid Goods and Services Tax (GST) claims.

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