India’s crypto-cautious approach does not seem to be sitting well with industry players that are looking at global expansion. Changpeng Zhao (CZ), the CEO of Binance has blamed India’s tax regime over the crypto sector for not making a viable business environment for exchanges to set up shop. The statements by Zhao were made during the TechCrunch Crypto Conference, that was held on November 17. India imposes a 30 percent tax deduction rule on all earnings churned via crypto activities, along with a one percent TDS cut on all crypto transactions.
Zhao, in his speech, said that India is not a very crypto friendly environment.
“We don’t see a viable business in India today. A user could trade 50 times a day and they will lose like 70 percent of their money. If you are going to tax 1 percent on each transaction, there is not going to be that many transactions. There is not going to be any volume for an order book type of exchange. We don’t go to countries where we won’t have a sustainable business — or any business,” a TechCrunch report quoted Zhao as saying.
Zhao has however, reinstated his trust in India’s potential to become a profitable market for crypto players. Binance has clocked 429,000 downloads in India as of August this year, surpassing all other competing exchanges.
The crypto exchange, founded in 2017, is striving to become the most licenced crypto exchange in the world.
Back in July, Ken Li, the investment director at Binance Labs had told Gadgets 360 in an interview that the company was actively monitoring the Indian market to grab lucrative business opportunities.
Zhao is however, not the only biggie from the global cryptosphere to have criticised India for not taking a crypto-friendly approach in general.
Back in May, Coinbase CEO Brian Armstrong had said that the Reserve Bank of India (RBI) had implied informal pressure on the exchange to roll back certain features.
In April, Coinbase announced that Indians would be able to purchase crypto assets on its platform using India’s own digital payments method — the UPI.
The launch of this feature was termed ‘unrecognised’ by the government, leading to its suspension from the Coinbase app.
Meanwhile, India is still working on formulating laws to govern the crypto sector. In a bid to support the growth of India’s Web3 ecosystem, a new crypto advocacy group called Bharat Web3 Association (BWA) has recently been launched in the country comprised of industry players like Polygon, CoinDCX, CoinSwitch Kuber, WazirX, ZebPay, and Hike among others.