Binance CEO Changpeng Zhao (CZ) says that India is currently not a suitable business environment for its cryptocurrency exchange, citing its strict tax regime. The chief executive explained, “Binance is going to countries where regulations support cryptocurrencies and business.”
Binance CEO on Indian Crypto Environment
The CEO of the Binance cryptocurrency exchange, Changpeng Zhao (CZ), does not currently see India as a suitable country to expand its cryptocurrency exchange operations. He detailed at the Techcrunch Crypto conference on Thursday:
To be honest, I don’t think India is a very crypto-friendly environment.
Zhao is particularly discouraged by the cryptocurrency tax regime that the Indian government introduced earlier this year. In addition to the 30% tax on crypto income, crypto transactions are subject to a 1% tax deduction at source (TDS).
Referring to India’s aggressive tax environment, Binance’s CEO said, “If you’re going to tax 1% on every transaction, there won’t be that many transactions.”
A user can trade 50 times a day and he will lose about 70% of his money. There will be no volume for an order book type exchange. So today we do not see a viable business in India.
“We just have to wait. We are in talks with a number of industry associations and influencers and are trying to bring some logic into this,” continued CZ.
“We are trying to get the message across, but changing tax policy usually takes a long time,” Zhao warned, adding:
Binance operates in countries where regulations support cryptocurrencies and businesses. We don’t go to countries where we won’t have a stable business – or no business at all, whether we go or not.
Several other global cryptocurrency exchanges have tried to launch in India, including Nasdaq-listed cryptocurrency exchange Coinbase. The exchange tried to launch in India in April, but soon stopped. Coinbase CEO Brian Armstrong said in May that the firm had cut support for the local UPI payment system “due to some informal pressure from the Reserve Bank of India.”
Even though crypto income and transactions are taxed, there is still no legal and regulatory framework for cryptocurrencies in India. Indian Finance Minister Nirmala Sitharaman has previously stated that cryptocurrency regulation will be one of the topics in the spotlight during India’s G20 Presidency. The government hopes to create a technological regulatory framework for cryptocurrency after discussing it with other G20 countries.
What do you think of Binance CEO Changpeng Zhao’s comments? Let us know in the comments below.
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