NEW DELHI – A recent report by Chainalysis has unveiled that India has secured its position as the second-largest cryptocurrency market in the world in terms of raw transaction volume. This achievement is noteworthy, especially considering the nation’s intricate tax laws surrounding cryptocurrency transactions.
Between July 2022 and June 2023, the South Asian country recorded crypto transaction volumes nearing an impressive $269 billion, outpacing other significant players like the UK, Turkey, and Russia. Remarkably, India achieved this milestone amidst a regulatory landscape that poses challenges for the cryptocurrency industry.
Chainalysis’ findings underscore India’s dominant position in the grassroots adoption of cryptocurrency. The report mentioned, “India leads the world in grassroots adoption as per our Global Crypto Adoption Index.”
The Indian government currently imposes a 30% tax on cryptocurrency gains and a 1% tax on every crypto transaction. This taxing structure, which is heftier than most nations, coupled with inconsistent application, has made the terrain difficult for indigenous exchanges to flourish.
However, the challenges haven’t quelled the Indian appetite for cryptocurrencies. Chainalysis stated, “Despite potential obstacles, the indomitable demand for cryptocurrency in India ensures its robust presence in the world’s second-most populous nation.”
While India’s crypto market thrives, the U.S. remains the dominant leader in global cryptocurrency transactions.
Furthermore, the report sheds light on Central & Southern Asia and Oceania’s collective contribution, accounting for 20% of the global cryptocurrency market. This region, with its diverse dynamics, is emerging as one of the most captivating cryptocurrency arenas globally.
Chainalysis also pointed out specific trends in neighboring countries. The Philippines, for instance, witnessed a surge in crypto adoption, propelled by the popular play-to-earn game, Axie Infinity. Meanwhile, Pakistan’s burgeoning interest in cryptocurrency is attributed to a need for wealth preservation due to soaring inflation and currency devaluation.
The rising trajectory of cryptocurrency adoption in this region underscores its potential to revolutionize financial systems, even amidst challenges and uncertainties.