The imposed tax has adversely impacted short-term investors and day-to-day trading volume
A 30% taxation on income from cryptocurrency and other virtual assets, was followed with the government’s decision to add a one percent tax deductible at source (TDS) on cryptocurrency transactions from July 1, this year. Even as this appeared as the first step towards regularising the sector, it is felt that the industry is reeling under an adverse impact of such steps. “From the perspective of cryptocurrency trading volume, it has dropped. The implementation of these tax laws has caused the stagnancy of Indian cryptocurrency markets. Prices are also getting lower. Short-term and day traders will get affected due to the implementation of the one percent TDS,” Shivam Thakral, CEO, BuyUcoin, told FE Online.
Industry expert opined that the move by the government will ward off investment from international players. According to Anndy Lian, chairman, BigONE exchange, this will affect the market’s liquidity and foreign investors will look to stay away from Indian markets. “It will not be sustainable for investors in the long run. Active traders will get adversely affected as it would decrease day time trading. The overall market conditions would deteriorate, as more Indian cryptocurrency exchanges will look to settle outside,” he added.
Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.
Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.
An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.