Over the past few months, cryptocurrencies prices have dipped more than risen and the global market capitalisation continues to be below $2 trillion, despite robust growth, especially in the latter half of last year.
Nischal Shetty, Founder and CEO of WazirX recently said to CNBC-TV18 , “The confusion around taxes is probably bigger issue right now; the future of the TDS, and everything coming in. Overall, volumes wise, there has been a dip of 30% to 40% in the last, let us say, 30 to 45 days in India. But globally, also there has been a 10% so India has taken a steeper drop in trading volumes, mostly because of these recent changes.
The government implemented 30% tax slab on digital assets from 1st April 2022, the announcement of tax on digital assets and crypto was made by Finance Minister Nirmala Sitharaman in her Union Budget speech on Feb this year.
Shetty said, “The markets are still trying to come to terms with the new taxation. We are also awaiting, further clarity, hopefully, on the TDS, and maybe a reduction of the TDS, from 1 percent to maybe 0.01 percent, which will really work well for the industry.”
He added, “There is some sense of deeper understanding amongst the participants about the taxation. There was a lot of confusion, which is clearing out. In terms of adoption, I would say, the interest is still very high, and for obvious reasons, because it is the norm globally, crypto is growing really fast.”
Shetty said, “Crypto usually moves in cycles, there has this one or two years of rapid growth and I would say that happened in the last two years. Then you have a period of building and seriousness and some ideas not really coming to conclusion or not being executed, I think we are entering that phase.”
He added, “So I see the next few years as a period of building and more maturity coming into the sector and this happens every cycle.”