Crypto chaos in India? New tax causes volumes to collapse

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Jana Ghana Mana! – Crypto trading volumes of major Indian exchanges, according to data collected by crypto research firm Crebaco Dropped significantly since April 1. That day, new tax Enacted on crypto profits in India. The volume of WazirX, the country’s largest exchange, fell 72%.

Heavy trade volumes in India

The volumes of four Indian exchanges were aggregated by analyzing data from another data firm, CoinMarketCap, and Nomics. The data reveal 72% drop in WazirX, 59% on ZebPay, 52% on CoinDCX and 41% on BitBns. Crebaco measured trading volumes in US dollars.

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India now imposes a tax 30% in profit from crypto transactions. Also, the country does not allow the offsetting of gains with losses on other transactions. The most controversial provision will not take effect until 1 July. As a matter of fact, India will then impose a 1% tax withholding at source (TDS).

“April 1, 2 and 3 were public holidays. Since then, volumes have continued to decline. I don’t think it will come back (…) It set a new benchmark. It may sink down or to the side, but is unlikely to rise again. It is clear that the new tax has had a negative impact on the market. The government needs to look into this. And since there is no way to stop this (crypto), the government must adopt the technology. »

Sidharth Sogani, CEO of research firm Crebaco

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According to crypto lawyer Suril Desai, the drop in volumes could mean trade shifts elsewhere. he stated “The only trading volume we receive comes from centralized exchanges. Off-chain exchanges which no trace it could be”.

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Crypto exchanges want to be reassuring

ZebPay exchange declined the comment. Additionally, other exchanges did not immediately respond to requests for comment. Sathvik Vishwanath, co-founder and CEO of another Indian exchange, Unocoin, meanwhile declaration He said the new tax law is affecting the market.

“People earning less than Rs 1,000,000 (about $13,000) is affected by the 30% flat income tax on crypto. The 1% TDS affects market makers and liquidity providers. Both are essential for a better crypto ecosystem in India. »

Sathvik Vishwanath, co-founder and CEO of Indian exchange Unocoin

Anton Gulin, regional head of the AAX crypto exchange, said that the drop in volume should reverse in the near term.

“AAX exchange has also seen the exit of active Indian users over the past few weeks. However, since that is the ultimate goal of any government, I think the tax rate could be revised to attract more taxpayers. »

Anton Gulin, regional manager of AAX crypto exchange

Trading volumes are collapsing in India following cryptocurrency regulation.

Johnny Lyu, CEO of the KuCoin trading platform, said that some startups are less inclined to invest in crypto in the short term.

“However, according to internal data, KuCoin has not recorded any exits. This can be explained by the higher degree of crypto-nativeness among our users (…) The new law will affect the mood and behavior of the market in the short-term, but in the long-term it will be difficult to curb crypto adoption. »

Johnny Lyu, CEO of KuCoin trading platform

While the recent regulation of cryptocurrencies in India has clearly caused trading volumes to drop, this should only be temporary. Indeed, these new laws at least define a clear framework for cryptoassets. As a result, many investors can pack their suitcases in the country. In any case, in case of change Coinbase, which decided to invest one million dollars in the country.

In India, regulators are causing an untimely monsoon in the stock markets. Protect yourself from the weather By signing up on BinanceReference platform (affiliate link) for buying and exchanging Bitcoin and cryptocurrencies.

Source From: Google News

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