Trading volume on Indian crypto exchanges plunges as 30% tax goes into effect
Payment services providers have also cut ties with giant crypto exchanges despite having the same rate for gambling and fantasy sports platforms.
According to crypto exchanges' fresh data, the trading volume reveals a significant decline in trading practices among Indians just ten days after the tax rule implementation. India's new 30% crypto tax rule came into effect on April 1, despite many stakeholders and exchange operators warning against its ill effects.
According to Indian blockchain analytic research data report firm Crebaco shows that trading volume on top Indian crypto exchanges has declined as high as 70% in the past 10 days.
WazirX trading volume declined from $47.8 million on April 1 to $13.2 million on Sunday. ConDCX's trading volume decreased from $12.16 million to $5.76 million. followed by Bitbns with an overall decline of 41.29% in the past ten days.
Crypto tax laws directly inspired by India's gambling laws, many payment processing partners that offer Unified Payment Interface (UPI) accessibility have also severed ties with crypto exchanges.
Coinbase recently had to suspend the crypto payment option just a day after inaugurating its crypto trading services for Indians. payment processors like MobiKwik had cut ties with the likes of WazirX and other crypto exchanges after a recent warning from the government.
Statement by NPCI as on 7th April 2022. With reference to some recent media reports around the purchase of Cryptocurrencies using UPI, National Payments Corporation of India would like to clarify that we are not aware of any crypto exchange using UPI. Please see attached document pic.twitter.com/lGTcaSLKeC— NPCI (@NPCI_NPCI) April 7, 2022
Crypto taxes have been based on the gambling laws, and the fantasy sports and gambling applications in the country have full access to all forms of
Coinbase disabled UPI service in India few days after NPCI statement.— Aditya Singh (@CryptooAdy) April 10, 2022
This is not new, Indian exchanges have also been facing payment service problem since 2018.
Weird fact - Actual gambling apps get proper payment service support while crypto exchanges are being alienated.
Many stakeholders in the crypto community have warned that these impractical tax measures and added restrictions on crypto trading would do more harm to the thriving crypto economy in the country and the early effects are visible.
Read: India's digital currency to take 'Very Calibrated, Graduated' approach: RBI Deputy Governor