- India’s crypto firms want to lower the 30% capital gains tax and 1% transaction tax to revive domestic trading.
- Policymaker meetings with crypto leaders have increased from twice a year to monthly or weekly sessions.
- Binance and Coinbase re-enter India as the crypto market is projected to grow from $2.5B to $15B by 2035.
India’s cryptocurrency sector is pressing for reduced taxes, responding to what many view as a more receptive government stance and increasing engagement with US trade interests.
Crypto Firms Lobby for Lower Taxes
According to Financial Times, India’s digital asset platforms have renewed efforts to reduce the 30% capital gains tax and the 1% transaction tax imposed in 2022. According to executives, these tax measures have discouraged domestic trading, forcing over 90% of Indian crypto activity to move offshore.
Ashish Singhal, co-founder of CoinSwitch, stated that the industry’s main request is a reduction in what he called “very harshly” enforced taxes. He proposed that a 0.1% transaction tax could maintain traceability without reducing trading volumes.
The current tax framework was originally introduced to curb money laundering and track criminal activities. However, a report from the Esya Centre revealed that the policy had the unintended effect of pushing the majority of trading offshore. Singhal added, “Now regulators are more closely talking to us, understanding what the space is.”
Growing Policy Engagement and International Influence
India’s relationship with digital currencies appears to be changing. Government officials are now engaging more frequently with the crypto sector. Meetings between policymakers and industry players are taking place “monthly, if not weekly,” compared to semiannual engagements in the past.
This increase in communication is happening against the backdrop of renewed global interest in crypto. Industry leaders have attributed part of this shift to Donald Trump’s return to the US presidency and his vocal support for digital assets.
“Thanks to Trump, the positive momentum that has happened in crypto has impacted India as well,” Singhal mentioned. The warming relations come as India and the United States negotiate broader trade ties, giving local crypto companies a fresh opportunity to push for policy reforms.
Major Exchanges Re-Enter India as Market Outlook Grows
With signs of regulatory openness, leading global exchanges Binance and Coinbase have resumed operations in India. Both companies had previously exited the market following the introduction of restrictive tax laws.
The resumption of these transactions also marks fresh optimism over India’s cryptocurrency outlook. The world’s most populated country is set to have its cryptocurrency market grow from $2.5 billion in 2024 to over $15 billion by 2035, says Grant Thornton.
Kush Wadhwa, a partner at Grant Thornton India, stated, “Competition has definitely started heating up.” He added that the Indian government is not aiming to block crypto growth but is focused on maintaining controls to prevent financial crime.
Crypto players believe that with better collaboration and policy clarity, India can unlock substantial value from its growing digital economy while keeping regulatory oversight intact.
