In the wake of a sharp drop in trading volumes of major Indian exchanges since the introduction of 30% tax on revenue received on April 1, the industry is now facing additional downward pressure following the introduction of another new tax, which was introduced last Friday. had begun. As a result the trading volume on the major platforms is reduced by about 95%.
Huge drop in trading volume
Daily trading volume at Binance-backed local crypto exchange, WazirX, fell by more than 63% to $5.36 million on July 1, from $14.53 million a day earlier, according to data collected by Nomics.com. For another giant, CoinDCX, volume dropped by about 20% during the same period.
The sharp drop in trading activity comes with the latest 1% tax – imposed by the Reserve Bank of India (RBI) – on the sale and transfer of crypto assets over $127. This comes at a time when broad interest in such assets has waned, as the primary cryptocurrency tumbled further below the key $20,000 level.
As a result, exchanges are under heavy pressure amid a sharp drop in trading volumes. For Indian platforms, the situation has worsened with the infamous 30% flat tax on all crypto earnings on 1st April.
According to a well-known analysis platform, their trading volume fell by 90-95% three months after the comprehensive tax law came into force. crypto india,
enough, Platforms such as WazirX, CoinDCX and Zebpay are down around 95% in trading volume during the same period. Based on current volume, the platform predicts that the exchange may generate only $1,000 to $3,000 of trading fee revenue.
1/ Since the new crypto tax rules came into force, trading volume on Indian exchanges continues to decline
Wazirx – $195M➡️$4.5M – 98%
Coindcx – $32M➡️$2.1M – 93%
Zebpay – $19M➡️$1.1M – 94%
Bitbns – $24M➡️$19.8M – 17% (Not so impressed by any means) pic.twitter.com/0MnT7EFGyg
— Crypto India (@CryptoIndia) 3 July 2022
Walled Seeking Restructuring
The latest example of Indian exchanges getting into conflict comes from Coinbase-backed Wold. The four-year-old firm announced the suspension of withdrawals, trading and deposits on its platform on July 4, citing financial difficulties of its key partners as affecting its business.
According to the company, the move is aimed at “exploring the appropriateness of potential restructuring options” with its financial and legal advisors.
Before the sudden announcement, the exchange had already laid off 30% of its workforce to survive through the crypto winter.
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