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The number of new registrations on cryptocurrency exchanges in India increased after the introduction of 1% tax

The number of Indian users of cryptocurrency exchanges has increased after the introduction of a 1% tax withheld by the Government of India on transactions above Rs 10,000, but trading volume has fallen sharply.

After the new tax rules came into effect in July, the number of downloads of the Binance cryptocurrency exchange application by users in India increased to 429,000. The FTX cryptocurrency derivatives exchange also showed an increase in the number of users. In January, the exchange’s application was downloaded by Indian traders about 40,000 times, and in July and August this number increased to 96,000 and 52,000, respectively.

The situation with Coinbase Global is quite different. In June, the number of downloads of its application in India was about 31,000, and in August it dropped to 16,000. Coinbase previously tried to expand its activities in the country by opening an Indian division, but was soon forced to suspend service to local traders due to problems with the payment system. Union Payments Interface (UPI).

At the same time, daily trading volume on large sites in India fell by more than 90%. Rohan Misra, CEO of SEBA India, noted that the tax ruling does not clearly state whether this one percent tax applies to cryptocurrency derivatives transactions. In addition, Indian trading platforms do not receive support from the banking system, which makes it difficult for users to make deposits and withdraw funds.

Despite the imposition of a surcharge and the lack of regulations to regulate cryptocurrencies, many marketplace leaders see India as a key market for the development of the industry. This was stated by the CEO of the KuCoin exchange, Johnny Liu. According to a study by KuCoin, a third of Indian crypto investors are concerned about regulatory uncertainty that is hindering the mass adoption of crypto assets in the country.

Source: Bits

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