Trading volumes on major Indian cryptocurrency exchanges have declined by 70% after a new transaction tax came into effect on July 1.
What Happened: Data shows that exchange volumes plummeted following the imposition of a 1% tax deducted at source (TDS) and 30% income tax on cryptocurrency transactions.
The 1% TDS is applicable to every digital asset transaction, including NFTs and other types of transactions on public blockchains.
See Also: Indian Crypto Players Have A New Tax Rule From Today: What You Should Know
Leading Indian cryptocurrency exchanges such as WazirX, Zebpay, BitBNS, and CoinDCX saw their average trading volumes decline from over $9.5 million per day to around $5 million at the time of writing.
Indian Crypto exchange's trading volume have plunged by 90-95% , 3 months after new crypto laws became applicable.“Crypto taxation and the government’s efforts to regulate the industry is a very positive step and a welcome move,” wrote CoinDCX CEO Sumit Gupta on Twitter (NYSE:TWTR).Based on current volumes - Exchanges are only able to generate trading fee revenue of $1000 to $3000 Max.
Bitbns seems to be still doing well.
Tough times ahead. pic.twitter.com/KNDbea9BCn
— Crypto India (@CryptooIndia) July 4, 2022
“However, imposing such high taxation on an asset class and an industry that’s just started to take off would do more harm than good. ”
Price Action: As per data from Benzinga Pro, the crypto market rose 5.60% over the last 24 hours. Bitcoin (CRYPTO: BTC) was up 6.18%, while Ethereum (CRYPTO: ETH) and Dogecoin (CRYPTO: DOGE) saw increases of 9% and 4.45% respectively over the same period.
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