Binance boss says India not a viable market for crypto

Binance founder and CEO Changpeng Zhao.

Changpeng Zhao, co-founder and CEO of crypto exchange Binance, said he does not see much potential in the Indian crypto market as of today.

“To be honest, I don’t think India is a very crypto-friendly environment,” Zhao, one of the most influential figures in the crypto industry, said at a TechCrunch crypto conference held on Thursday.

Zhao’s comments come at a time when the crypto world has been roiled by the spectacular collapse of Binance’s rival FTX. India’s crypto industry in particular has been perpetually in a state of flux because of regulatory uncertainty and taxation zeal of authorities.

Zhao also weighed in on the tax element in India. The nation's high tax environment has made it difficult for global companies to operate, according to him.

“If you are going to tax 1 percent on each transaction, there is not going to be that many transactions,” he said.

“A user could trade 50 times a day and they will lose like 70 percent of their money. There is not going to be any volume for an order book type of exchange. So we don’t see a viable business in India today. We just have to wait. We are in conversation with a number of industry associations and influential people and trying to put some logic there,” he said.

Read More: Binance pledges to create crypto industry recovery fund, calls for regulation

This in not the first time Zhao has issued a warning on the Indian crypto market.

Earlier this month, the Binance boss had said India’s onerous taxes on cryptocurrency transactions would probably “kill the industry” in the nation.

“India has high tax which is probably going to kill the industry,” Zhao had said at a conference in Singapore.

His comments came after the government introduced an additional tax of one percent -- to be deducted at source -- on digital-asset transfers worth over Rs 10,000 rupees or on a combined Rs 50,000 of transactions over a single financial year that has vapourised trading volumes.

The step follows any gains on transfer of crypto assets being taxed at 30 percent since April,  the rate being a higher than in many other jurisdictions including the US and the UK.

As policies crush the local market, one of India’s oldest cryptocurrency exchanges ZebPay is looking overseas for growth.

WazirX too bore the brunt of the taxes with trading volumes drying up and an ugly spat with Binance over its ownership further vapourising transactions.

Also read: ED investigation, Binance break-up—is brand WazirX crumbling?