Investor interest in crypto trading has seen some revival in recent days as exchanges try to resolve payment issues, but sentiment remains mixed on tax provisions.
A number of exchanges Activity area spoke with said bank transfers continue to work for them.
“Our banking partners and payment gateways continue to operate. This is not a deterrent at this time,” the head of a crypto exchange said, noting that many small and medium-sized private banks were willing to work with crypto exchanges.
Others like WazirX are in talks with banking partners.
“Currently, the banking industry is reluctant to provide crypto exchange channels to deposit funds. However, we are in talks with banking partners to resolve the issue as soon as possible and help provide our users with other faster and hassle-free deposit methods. The provision of taxes establishes that crypto is not a shadow industry; so we hope to see banks getting back to business with the industry soon,” said Nischal Shetty, Founder of WazirX.
It was a difficult month for the sector, which was already struggling with the new tax provisions. The problems piled up after crypto investors were no longer able to use UPI for payments earlier this month.
“The recent collective denial of payment access to exchanges is without legal basis and against the Supreme Court’s verdict in IAMAI v RBI,” said Mohammed Danish, Chief Legal Officer of Bitdrive Exchange.
The exchanges said concerns over tax issues remain paramount for investors and greater volatility is expected until July when the 1% withholding tax comes into effect.
Praveen Kumar, Founder and CEO of Belfrics Group, said the exchange was impacted by tax issues, not so much payment issues.
“Our future activities have been hampered. We are just starting in India and plan to accelerate the onboarding process and business activities. It has slowed down due to TDS and fiscal concerns,” he said, adding that there is also huge volatility globally.
Nevertheless, new investors have started to arrive, he said. Trading volumes on the exchange were up 20-25% after April 15, compared to the previous fortnight, he said.
However, according to data shared by crypto research firm Crebaco, trading volumes have continued to fall on major exchanges since the start of the month, with some spikes on days like April 11.
“The volume of transactions has increased due to global market conditions. Globally, crypto markets turned a bit bullish as Bitcoin saw major resistance at $40,000. This also led to a ripple effect on Indian exchanges. Existing active traders have resumed trading. But, overall, trading volumes are still depressed in Indian markets. The 30% tax is a big problem, as well as problems with payments via UPI,” said Sidharth Sogani, founder and CEO of Crebaco.
April 20, 2022
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Crypto Exchanges Tackle Payment Problems; Tax concerns remain – Tech Tribune France
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