Wazir X – Imposing Crypto Tax Turns Out To Be A Blessing For India’s Leading Exchanges

Aniket Jain 2022-02-18 09:02

India’s plan to levy a 30% tax on revenues from cryptocurrency trading is proving beneficial to the country’s digital-asset exchanges. Binance-owned WazirX, India’s largest crypto market, has experienced a nearly 30 percent increase in daily sign-ups on its platform since Feb. 1.

When the government announced the fee on digital asset transfers in its annual budget, according to co-founder Nischal Shetty. According to creator Ashish Singhal of competitor CoinSwitch, the daily gain was 35%.

While it may appear contradictory that a high tax would lead people to rush to digital tokens, the move was perceived as legitimizing a business that had been in regulatory limbo due to vehement opposition from India’s central bank.

Shetty anticipates that 100 million individuals in the nation would begin investing in cryptocurrency within the next two to three years.

Cryptocurrencies are experiencing “a lot more clarity and visibility” now that they are legal in India, according to Rajesh Shetty, the country’s top financial officer.

Imposing Crypto Tax A Good Decision?

As per the exchange, the number of registered users on CoinSwitch increased from 1 million in January to 15 million in February.

The exchange’s consumer education activities can be credited with a chunk of the recent rise in sign-ups. Neither exchange provided information on the total number of clients added since February 1.

According to Shetty, the average new client deposits between 30,000 and 40,000 rupees ($400 and $533) in their trading account. WazirX is also seeing more interest from firms who were previously scared of the “optics” of investing in cryptocurrency, he added.

India has yet to pass legislation governing digital assets, leaving the country’s burgeoning crypto economy in limbo.
At the same time, the Reserve Bank of India has been a vociferous opponent, with Governor Shaktikanta Das earlier this month describing cryptocurrencies as a threat to stability and drawing comparisons to the 17th-century Dutch tulip frenzy.

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