Dear Bankless Nation,
Welcome to Bankless Hindi!
Trading volumes continue to dip on Indian exchanges as the new tax laws come into force. Payment gateways are also withdrawing their support on exchanges fearing backlash from the government. It is a difficult time for crypto investors in India but the only thing we can do currently is continue dialogue with the authorities and show them examples of the positive change crypto can create. In today’s newsletter, we look at some of the stated developments.
Coinbase halts UPI payments for crypto within three days of India launch
Within days of announcing its launch in India with much fanfare, Coinbase has halted payments via united payments interface (UPI) on its app. Last week, the National Payments Council of India (NPCI) said it was not aware of any crypto exchanges using the UPI after Coinbase revealed it to be the payment mechanism on its platform. Coinbase had entered India even as domestic cryptocurrency exchanges were witnessing a sharp fall in volumes in the first week of April following the implementation of a new tax regime. The company’s India tech hub employs 300 full-time staff and the company plans to hire over 1,000 people in the country this year.
Read more on this, here.
https://www.business-standard.com/article/companies/coinbase-halts-upi-payments-for-crypto-within-three-days-of-india-launch-122041100027_1.html
Crypto Trading Volumes in India Collapse 10 Days After New Tax: Crebaco
Crypto trading volumes of India’s major exchanges have nosedived since April 1, the day a new tax on crypto profits came into effect, according to data collected by Crebaco, a cryptocurrency research firm. The volumes of four Indian exchanges were collated by analyzing data on CoinMarketCap and Nomics, a data firm. The data reveals a drop of 72% on WazirX, 59% on ZebPay, 52% on CoinDCX and 41% on BitBns. Sathvik Vishwanath, co-founder and CEO of Unocoin, another Indian exchange, said the new tax law is affecting the market. “People earning less than 1,000,000 (Indian rupees) per year is affected by 30% fixed income tax on crypto. 1% TDS is affecting the market makers and liquidity providers. Both are needed for better crypto ecosystem in India,” Vishwanath said on Twitter. India was touted as one of the fastest growing markets in the world. However, the new regulations have severely restricted growth and curtailed increased participation.
Read more on this, here.
https://www.coindesk.com/business/2022/04/11/crypto-trading-volumes-in-india-collapse-10-days-after-new-taxes-crebaco/
MobiKwik Withdraws E-Wallet Services From Crypto Exchanges Hurdles seem to keep on increasing for crypto exchanges in India. Most recently, e-wallet provider Mobikwik seems to have disabled its services in India for crypto exchanges since April 1. The MobiKwik option continues to appear on some crypto exchange apps, but the services are not functioning. MobiKwik’s withdrawal follows a statement published by Unified Payments Interface (UPI) parent, the National Payments Corporation of India (NPCI). On April 7, NPCI put out a statement saying they were not aware of any virtual digital asset exchange using UPI for transactions. “With reference to some recent media reports around the purchase of cryptocurrencies using UPI, National Payments Corporation of India would like to clarify that we are not aware of any crypto exchange using UPI,” the statement read. The crypto exchanges have been left in a lurch with two of the transaction options for investors suddenly not available. As of now, both the UPI and MobiKwik options continue to appear on some crypto exchange apps, but the services are not functioning.
Can you avoid paying 30% tax by buying crypto on foreign exchanges?
How to avoid paying 30% tax on crypto income in India? This is probably one of the biggest questions on the minds of Indian crypto investors ever since the announcement of flat 30% tax on income from crypto and other virtual digital assets (VDAs). Many investors are still looking for tricks to avoid tax. In quest of saving tax, they are falling prey to many so-called experts. One of such tricks being shared by these so called experts is that you can avoid 30% tax by investing on foreign exchanges. However, legal experts say you cannot avoid paying 30% tax on crypto income by investing on foreign exchanges. It is important to understand that 30% tax is on the income Indian investors may make from crypto or other VDAs. Even if you buy or sell crypto on exchanges located outside India, you are required to report your income to the tax department. Experts say that not paying tax on any such income would be equivalent to tax evasion and may complicate your life due to legal hassles.