Crypto tax deters 83% Indian investors from crypto trading: WaxirX report
The implications of what anti-crypto regulations can do to a thriving economy can be seen first-hand unfolding in India. Supporting the massive decline in trading volumes across all Indian crypto exchanges, a report from WazirX reveals a change in investor sentiment as the Indian government imposed its second crypto law — a 1% tax deduction at source (TDS) on every crypto transaction.
Trading volumes on Indian crypto exchanges saw an eventual reduction of 90-95% ever since the country introduced a law that would tax investors 30% on unrealized gains. With two consecutive taxes ready to eat away at their holdings, most Indian investors have seemed to have opted for hibernation amid an unforgiving bear market.
Indian Crypto exchange's trading volume have plunged by 90-95% , 3 months after new crypto laws became applicable. 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
Prominent Indian crypto exchanges WazirX and Zebpay surveyed around 9,500 active traders from the region to better understand investor sentiment. Unsurprisingly, the survey revealed that 83% of traders were forced to reduce their trading frequency owing to the TDS deductions.
WazirX & @zebpay recently conducted a Trader Sentiment Survey which revealed that 83% of traders are of the opinion that recent tax implementation has deterred their trading frequency. More on the survey https://t.co/Zim75TqslP
Another method investors in India avoided paying TDS was by selling their holdings before the taxation was signed into law. Over 27% of the investors, the majority comprised of millennials, ended up selling 50% of their portfolio
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