New trend of investment in crypto: Crypto trade of banned Chinese company in China is spreading in India, investors shifted if tax was imposed in India
In order to discourage trading of cryptocurrencies in India, 30% tax has been deducted from 1st April and 1% TDS from 1st July. After this, the daily trading of crypto on the platform operating in the country decreased by 90%. However, in the meantime a new trend has emerged. In about two and a half months, many investors of the country have shifted to the Chinese exchange.
Data from market intelligence firm Sensor Tower showed that China’s banned Chinese-born founder Binance Holdings grew in India to 4.29 lakh downloads in August. This is three times that of its rival exchange CoinDCX. Not only this, Binance was the most downloaded in August as compared to July.
Binance overtakes with low fees and multiple offers
The world’s largest crypto exchange overtook the Indian market, while other rivals faltered due to steep tax hikes and lack of smooth movement of money. Binance founder Changpeng Zhao’s low fees and many offers have left competing platforms behind. That’s why investors started visiting this platform for tax evasion. Many investors, on condition of anonymity due to tax regulations, point out that platforms in India have started deducting taxes, while Binance and FTX are not.
Still confused about tax rules
Rohan Mishra, CEO, Seba India, the Indian arm of Switzerland-based Seba Bank AG, says, “It is not clear in the tax rules whether 1% TDS will be applicable on transactions in futures linked crypto derivatives as it is for spot transactions. On the question of tax collection, a Binance spokesperson said that it is monitoring the situation. The Finance Ministry did not respond to the email.
Binance: Registered in Cayman Islands; Now operating from Malta, Bermuda, Singapore
Binance established in China is banned in China. China banned crypto trading in 2017. Stricter in the year 2021. Since then Binance is registered in the Cayman Islands and is doing business from Malta, Singapore, Bermuda. Chinese people are not allowed to open accounts in Binance.