The Indian government in its financial speech had decided to levy a 30% on all cryptocurrencies. Besides this, they had also decided on an additional 1% Tax Deduction on Source (TDS) for all crypto transactions. This has had a severe impact on the crypto economy as India’s crypto trading volume has dropped quite to an extent.
According to the crypto research firm Crebaco, there is a substantial drop in crypto trading volumes across all major crypto exchanges. WazirX dealt with the worst blow, dropping up to 72% in terms of the trading volume. On the other hand, CoinDCX and Zebpay suffered drops of 52% and 59% respectively.
Besides this, Mobikwik has withdrawn its services across all exchanges on April 1. The company cited “unclear regulations” as the reason for this action. This is huge since many users used Mobikwik as a preferred method of payment for purchasing crypto at crypto exchanges.
Previously, the Nasdaq-listed crypto exchange Coinbase had announced its launch in India. Moreover, they added that users can transfer funds to buy crypto via the Unified Payments Interface (UPI) system.
However, the National Payments Corporation of India (NPCI), the creator of UPI, stated that no crypto exchange is using the UPI system.
Moreover, they also added that the banks have the authority to allow their customers to transfer funds onto crypto exchanges.
Crypto exchanges could face another blow after the 1% TDS comes into effect. That provision will go into effect from July 1st. However, many people including some in the parliament have concerns that this will kill the crypto industry in the country.
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